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WEALTH  AGAINST  COMMONWEALTH 
A  STRIKE  OF  MILLIONAIRES  AGAINST  MINERS 

LABOR  COPARTNERSHIP 
A  COUNTRY  WITHOUT  STRIKES 


Milford  Sound. 


(Page  34-) 


NEWEST  ENGLAND 


NOTES  OF  A 

DEMOCRATIC   TRAVELLER 

IN   NEW  ZEALAND,   WITH   SOME 

AUSTRALIAN   COMPARISONS 


A-*—  p^-'1—  *^—  ^- 


y  -*- 


NEW  YORK 
DOUBLEDAY,  PAGE  &   CO. 

1900 


Copyright,  1900,  by 
HENRY  DEMAREST  LLOYD. 


CONTENTS 

CHAPTER  PAGE 

i  "THE  LEAST  BAD"         .......       i 

ii  "OUR  MUTUAL  FRIEND"       .        .        .  .        .12 

in  THE  RAILWAY  KINGS 31 

iv  No  "  PUBLIC  BE  DAMNED  "  60 

v  THE  WORKMEN  ARE  THE  CONTRACTORS         .        .        .82 

vi  TAXATION  TO  BURST  UP  MONOPOLIES    ....  104 

VH  A  MAN  BETTER  THAN  A  SHEEP     .        .         .        .        .126 

vin  "LANDLESS  MEN  HAVE  THE  PREFERENCE"   .        .        .  157 

ix  TRAMPS  MADE  TAXPAYERS     .        .        .        .        .        .192 

x  A  COUNTRY  WITHOUT  STRIKES 233 

xi  QUARANTINING  THE  PANIC  OF  1893  ....  276 
xn  "AND  THEN  WE  SMASHED  THE  MONEY  RING"  .  .  299 
xin  GOVERNMENT  AND  COMPANY,  UNLIMITED  .  .  .  309 
xiv  PENSIONS  FOR  VETERANS  OF  WORK  ....  339 
xv  "  A  SUBSTITUTE  FOR  A  FRENCH  REVOLUTION  "  .  .  364 

APPENDIX 379 

INDEX 381 


LIST   OF  ILLUSTRATIONS 

MILFORD  SOUND Frontispiece 

MX.  COOK Facing  Page    34 

MR.  SAMUEL  VAILE «  74 

PREMIER  SEDDON «  84 

A  CO-OPERATIVE  GROUP  AT  WORK       ..."  92 

UNEMPLOYED  BUILDING  THE  MAHOKINE  VIADUCT        "  96 

CHEVIOT — ONE  MAN  OWNED  AS  FAR  AS  HE  COULD  SEE  "  ic8 

\j 

CHEVIOT — AFTER  THE  PEOPLE  TOOK  IT  BACK     .        "  168 

MONEY,  LAND,  WORK,  INSTRUCTION      .         .        .        "  190 

A  HOME  IN  A  VILLAGE  SETTLEMENT    .        .        .        "  192 

WASTE  LABOUR  APPLIED  TO  WASTE  FOREST         .        "  200 

FAMILIES  ARE  KEPT  TOGETHER     .        .        .        .        "  200 

MT.  EGMONT  OVERLOOKING  WHANGAMOMONA        .        "  208 

TENTS  ARE  READY  FOR  THEM       .        .        .        .        "  214 

THE  HON.  WILLIAM  PEMBER  REEVES  (AUTHOR  OF 

THE  COMPULSORY  ARBITRATION  LAW)    .        .        "  258 

WHITE  LABOUR  IN  THE  SUGAR  CANE   ..."  312 

TIN  FOR  HOUSES  ON  THE  ROAD  TO  INDEPENDENCE     "  372 

LAND  FOR  THE  LANDLESS,  WORK  FOR  THE  WORKLESS     "  372 


NEWEST    ENGLAND 


CHAPTER   I 
"THE  LEAST  BAD" 

I  WENT  to  New  Zealand  to  see  what  had  been  done  for 
a  higher  social  life,  by  the  methods  of  politics,  in  the 
country  in  which  those  methods  have  been  given  the  best 
trial.  That  that  country  is  New  Zealand  will  be  admitted 
by  all,  by  those  who  approve  and  those  who  disapprove. 
New  Zealand  democracy  is  the  talk  of  the  world  to-day. 
It  has  made  itself  the  policeman  and  partner  of  industry 
to  an  extent  unknown  elsewhere.  It  is  the  "experiment  sta- 
tion" of  advanced  legislation.  Reforms  that  others  have 
been  only  talking  about,  New  Zealand  has  done,  and  it 
has  anticipated  the  others  in  some  they  had  not  even  begun 
to  talk  about. 

Co-operation — with  its  stores,  factories,  banks,  and,  now, 
farms,  where  the  consumers  and  producers,  the  capitalists 
and  the  labourers,  are  the  same  people — is  the  "Farthest 
North"  in  the  sphere  of  self-help.  New  Zealand  democracy 
is  the  Farthest  South  in  the  sphere  of  politics,  which  must 
still  be  called  "self-help,"  for  in  a  democracy,  in  self-gov- 
ernment, state-help  is  self-help. 

This  country  with  the  newest  institutions  has  the  oldest 
land,  Alfred  Russel  Wallace  and  colonial  geologists  tell 
us;  but  if  the  first  to  be  made,  it  is  the  last  to  be  used. 
When  the  Maoris  reached  it  about  five  hundred  years  ago 


2  "THE    LEAST    BAD" 

they  found  it  almost  wholly  destitute  of  food  plants  or 
food  animals — except  a  few  unappetising,  but,  as  the  event 
proved,  not  indigestible  aborigines.  It  was  an  unfurnished 
house;  even  the  rat  was  imported,  and  by  accident,  in  the 
canoes  of  the  first  Maoris.  Cattle,  game,  cereals,  vege- 
tables, fruit,  men  and  institutions  have  all  had  to  be  pro- 
vided, and  the  process  is  still  going  on.  The  ship  on 
which  I  went  carried,  besides  the  other  American  passen- 
gers, three  hundred  and  fifty  Kansas  quail  to  the  New 
Zealand  Acclimatisation  Society;  and  I  arrived  in  time  to 
see  the  first  quarter's  payment  made  to  worn-out  working 
men  and  women  by  the  only  people  in  Christendom  who 
have  been  willing  to  tax  every  one  of  themselves  for  old- 
age  pensions. 

New  Zealand  lies  about  as  far  to  the  south  of  the  equa- 
tor as  Japan  to  the  north.  It  is,  like  Japan  and  like  the 
mother  country,  a  group  of  islands,  and  is  not  unlike  Japan 
in  the  lie  of  the  land,  running  in  a  long  narrow  strip 
about  fifteen  hundred  miles  north  and  south,  and  is  like 
Japan  in  a  beauty  of  scenery  which  even  the  oldest  trav- 
eller finds  it  hard  not  to  rave  about. 

It  lies  midway  between  the  extremes  of  the  tropics  and 
the  pole,  and  is  cooled  by  the  mountains  and  the  sea,  with 
plenty  of  rain  and  sunshine,  and  all  that  rain  and  sun- 
shine bring.  Australia  is  a  sunburned  continent,  desert  in 
the  interior  and  almost  without  rivers,  rimmed  with  a  fer- 
tile coast-line,  with  droughts  lasting  for  years,  but  the  New 
Zealander  begins  to  grumble  about  the  "drought"  if  he 
goes  a  month  without  rain.  The  climate  is  a  wine  with- 
out headache;  like  that  of  Japan,  the  best,  though  not  the 
most  perfect,  to  be  found  anywhere.  It  has  the  variability 
that  gives  vigour,  without  the  perpetual  smile  that  makes 
Hawaii  so  depressing,  if  you  outstay  its  first  welcome.  The 
soil  is  largely  a  wash  from  the  mountains,  and  you  hear 


BRITAIN   OF   THE   PACIFIC  3 

nothing  of  the  malaria  which  plays  such  mischief  with 
the  early  settlers  in  the  Mississippi  Valley  and  in  Africa. 

Almost  every  New  Zealander  lives  within  sight  of  the 
mountains  or  the  ocean,  or  both.  Its  landscapes  show  long 
ranges  and  solitary  giants,  tipped  with  Alpine  glow;  there 
are  waterfalls  everywhere,  some  of  them  among  the  finest 
in  the  world,  luxuriant  country-side,  golden  farms,  lakes, 
geysers,  volcanoes,  forests  with  miles  of  pink,  white,  and 
red  flowering  trees  in  spring,  and  there  are  fiords  of  the 
sea  threading  their  way  around  the  feet  of  mountains 
crowned  with  glaciers  and  perpetual  snow.  The  scenery 
is  a  synopsis  of  the  best  of  Norway,  Switzerland,  Italy, 
and  England,  with  occasional  patches  of  Gehenna  in  the 
pumice  country  around  the  hot  lakes. 

New  Zealand  has  the  area,  approximately,  of  Italy,  but 
Italy  has  forty  times  its  population  of  about  780,000,  and 
40,060  of  these  are  Maoris.  Australia  is  as  large  as  the 
United  States  without  Alaska,  but  has  only  a  little  more 
than  one  twentieth  of  our  population,  and  only  one  ninety- 
fifth  of  that  of  Europe,  which  it  equals  in  area,  but  in  area 
only.  We  speak  commonly  of  New  Zealand  and  Australia 
as  if  they  were  in  hail  of  each  other,  but  New  Zealand  is 
half  as  far  from  Australia  as  America  is  from  Europe,  and 
they  are  stormy  waters  that  guard  those  shores.  He  will 
need  to  be  a  bolder  and  more  successful  invader  than  Philip 
of  Spain  who  proposes  to  land  hostile  troops  on  the  coast 
of  this  Britain  of  the  Pacific. 

It  is  not  so  much  the  fashion  as  it  used  to  be  to  inter- 
pret men  and  their  institutions  in  the  terms  of  their  cli- 
mate and  soil,  but  if  any  people  and  any  institutions  are, 
and  will  be  more  and  more  affected  by  these  things,  they 
are  those  of  Australasia.  This  is  especially  true  of  New 
Zealand.  Its  isolation  protects  it  from  tidal  waves  of  heat, 
cold,  immigration,  fashion,  speculation,  or  invasion.  The 


4  "THE   LEAST    BAD" 

people  are  likely  to  remain  what  they  are — the  most  homo- 
geneous Anglo-Saxon  blend,  the  most  harmonious  constitu- 
ency of  our  race  there  is  anywhere — English  predominant, 
Scotch  next,  Irish  third.  There  is  practically  no  other 
blood;  the  foreigners  and  Maoris  are  too  few  to  colour 
the  strain. 

There  is  a  soil  of  wonderful  fertility  in  New  Zealand, 
but  it  lies  in  patches,  in  valleys,  and  between  mountains 
and  the  sea.  The  eyes  were  easily  picked  out  by  the  first 
comers.  Great  stretches  are  fit  only  for  sheep  and  cattle, 
and  so  only  profitable  when  held  in  large  blocks.  This  is 
just  the  environment  for  land  monopoly,  which  soon  took 
on  an  intense  form,  with  consequences  economic  and  po- 
litical, which  will  need  many  of  the  following  pages  to 
describe.  Immigration  into  New  Zealand  and  Australia 
was  hard  for  men,  easy  for  money;  and  Anglo-Saxon  peo- 
ple on  such  a  soil,  with  Anglo-Saxon  institutions,  includ- 
ing the  greatest,  the  government  bond,  could  borrow  all 
they  could  use.  Hence  there  is  here,  on  a  very  small 
population,  a  very  large  debt — larger  than  in  any  other 
country,  even  France.  The  climate  of  New  Zealand  has 
no  extremes,  and  the  people  are  most  moderate  in  their 
temper  and  policies.  The  purpose  one  hears  them  most 
often  avow  is  that  they  mean  to  have  no  millionaires  or 
paupers — a  political  rendition  of  Agur's  "neither  poverty 
nor  riches."  Their  temperate  climate  is  a  democratic  cli- 
mate, for  the  more  opportunities  there  are,  the  more  need 
there  is  for  democracy,  which  is  the  organisation  of  oppor- 
tunity for  all. 

New  Zealand  is  made  up  of  two  large  islands  and  some 
smaller  ones — like  the  mother  country — and  race  and  situ- 
ation are  at  work  here,  as  Emerson  saw  them  in  England, 
making  every  islander  himself  an  island,  and,  as  is  always 
the  way  with  islanders,  these  are  growing  to  their  home 


A   WHITE   MAN'S    COUNTRY  5 

with  heart-strings  stronger  than  steel.  Its  policy  of  pros- 
perity for  all  instead  of  excess  for  a  few  will,  for  many 
ages,  prevent  the  appearance  in  New  Zealand  of  any  splen- 
dour to  tempt  the  cupidity  of  enemies.  It  is  too  far  from 
Australia  for  federation.  No  matter  what  improvements 
are  made  in  ocean  travel,  it  will  always  be  five  or  six 
times  as  far  from  Europe  to  New  Zealand  as  from  Europe 
to  America.  Modern  steamships  and,  alas!  men-of-war 
are  converting  the  Pacific  into  a  mere  Mediterranean,  but 
a  Mediterranean  of  a  new  civilisation,  a  sea  to  connect,  not 
to  divide,  the  awakening  East  and  the  advancing  West; 
but  New  Zealand,  unlike  its  mother  country,  is  so  much  to 
one  side  of  the  world's  great  currents  that  it  cannot  be- 
come the  clearing  house  of  these  movements  of  commerce 
and  population,  destined  to  be  the  greatest  of  the  past  or 
the  future. 

Australasia  produces  more  wealth  and  spends  more  for 
every  man,  woman  and  child  than  any  other  country,  and 
New  Zealand  is  the  most  prosperous  of  the  seven  colonies 
of  Australasia.  New  Zealand  has  practically  every  re- 
source for  the  support  of  life  and  the  creation  of  wealth. 
It  is  a  white  man's  country,  if  there  ever  was  one,  and 
the  people  fit  the  country  with  much  more  than  the  Euro- 
pean or  the  American  average  of  energy,  physique,  intelli- 
gence, honesty  and  industry.  A  tree  falls  in  the  forest 
and  in  its  roots  is  found  a  gold  mine ;  a  citizen  digs  a  post- 
hole  and  cuts  into  a  vein  of  coal  forty  feet  thick.  The 
most  precious  metal  of  all,  iron,  is  found  in  abundant  de- 
posits, one  of  them  in  the  Taranaki  sands  of  inexhaustible 
quantity,  and  so  pure  and  rich  that  it  has  so  far  defied  re- 
duction. There  is  flax,  and  there  can  be  cotton  whenever 
the  people  choose  to  grow  it.  There  are  nowhere  travel- 
ling rugs  so  soft  and  warm  as  those  made  out  of  New 
Zealand  wool.  Electric  power  beyond  calculation  is  going 


6  'THE    LEAST    BAD" 

to  waste  in  a  thousand  and  one  waterfalls  and  rapids.  This 
exceeding  bounty  and  beauty  of  their  own  home  pulls  more 
strongly  every  day  against  the  recall  of  the  old  home.  All 
these  physical  circumstances  make  for  "New  Zealand  for 
the  New  Zealanders,"  and  New  Zealanders  for  New  Zea- 
land. The  "lengthening  chain"  that  ties  these  people  to  old 
England  may  easily  lengthen  into  invisibility. 

The  crow  in  New  Zealand  strikes  as  sweet  a  note  as  any 
heard  in  the  woodland;  the  robin  has  no  song  and  no  red 
breast;  the  native  hen  is  the  greatest  of  rat  killers;  there 
is  a  caterpillar  which  blossoms.  These  and  some  other 
productions  of  nature  have  done  Tor  New  Zealand  what 
the  kangaroo  and  the  ornithorhynchus  have  done  for  Aus- 
tralia— given  it  the  suggestion  of  oddity  and  the  marvellous. 
Rabbits  and  sweet-briars,  introduced  for  pleasure,  spread 
like  wildfire,  and  it  is  an  attraction  to  be  duly  advertised 
in  the  sale  of  land  that  it  has  been  cleared  of  sweet-briar 
and  fenced  against  rabbits,  and  then  later  the  rabbit  be- 
comes a  profit  instead  of  a  pest,  and  is  exported  by  millions 
to  feed  the  English. 

There  is  something  in  the  air  which  makes  ideas,  too, 
run,  and  not  among  men  alone.  A  kea  parrot,  hungry  or 
curious,  tastes  of  a  sheep  lying  derelict  on  one  of  the  great 
grazing  plains,  and  forthwith  the  whole  tribe,  hitherto  irre- 
proachably vegetarian,  turns  carnivorous,  and  not  carniv- 
orous alone,  but  epicurean.  The  kea  finds  that  the  kidney 
is  the  choice  morsel,  and,  better  than  that,  it  is  most  to  its 
taste  when  eaten  from  the  living  animal.  Within  living 
memory,  the  Maoris,  on  the  contrary,  have  changed  from 
cannibals  into  citizens  and  members  of  Parliament,  and 
their  women  have  changed  from  squaws  to  voters.  The 
woods  and  plains  of  Africa  and  America  were  found  rich 
with  game  by  the  natives  and  new  arrivals  alike,  but  the 
New  Zealand  larder  was  empty  when  man  came.  The 


THE  WINGLESS   BIRD  7 

European  in  search  of  "somebody  else's  burden"  to  carry 
off  has  never  encountered  any  other  aborigines  with  the 
strength,  bravery  and  intelligence  of  the  Maoris.  They 
won  recognition  which  no  other  aborigine  has  received. 
As  property  owners,  voters,  members  of  Parliament  and 
even  ministers  in  the  government  their  rights  are  unques- 
tioned. The  Maori  fought  the  white  man  so  well  for  his 
land  because  he  had  had  to  fight  nature  so  hard  for  his 
life.  The  lack  of  food,  animal  and  vegetable,  in  primitive 
New  Zealand  developed  this  Maori  out  of  the  inferior 
Polynesian,  and  has  left  deep  marks  and  beneficent  ones  on 
the  social  institutions  of  the  country. 

There  are  earthquakes  and  volcanoes  in  New  Zealand, 
and  some  of  the  conservatives  there  number  with  them  the 
progressive  land  tax,  the  progressive  income  tax,  the  labour 
legislation  and  old-age  pensions.  The  traveller  sees  in 
and  out  of  museums  many  varieties  of  the  wingless  birds 
peculiar  to  New  Zealand,  and,  if  he  is  a  democratic  trav- 
eller, he  will  think  that  not  the  least  interesting  among 
them  are  the  capitalists,  who  have  not  taken  flight  as  it 
was  predicted  they  would  if  arbitration  were  made  com- 
pulsory and  the  great  estates  were  "resumed"  by  the  gov- 
ernment and  cut  up  into  small  farms. 

The  secret  of  the  democratic  efflorescence  of  Australasia 
is  the  same  as  that  of  the  new  vigour  shown  there  by  Euro- 
pean plants  and  animals.  The  secret  is  the  same  as  that 
of  the  long  step  ahead  of  the  mother  country  taken  by  New 
England,  with  its  Puritans  and  Pilgrims.  The  wonderful 
propagative  power  of  democratic  ideas  in  Australasia  is  a 
fact  of  the  same  order  as  the  miraculous  multiplication  of 
the  European  sweet-briar  and  rabbits  introduced  there. 
The  old  ideas  and  institutions,  given  a  new  chance  in  a 
new  country,  gain  a  new  vigour.  It  is  their  new  world. 
Hopes  and  purposes  which  had  fossilised  in  the  old  country 


8  "THE   LEAST    BAD" 

live  again.  When  the  holdback  of  custom,  laws,  and  old 
families  is  removed,  there  is  a  leap  forward  as  from  a 
leash.  What  Australasia  has  been  doing  is  only  what  Eng- 
land and  the  older  countries  have  been  slowly  attempting 
to  do.  Paradoxically,  too,  this  renaissance  of  democracy 
in  Australasia  is  not  the  fruit  of  colonisation  by  religious 
enthusiasts,  or  social  reformers,  or  patriots  choosing  exile, 
but  of  colonisation  by  plain,  every-day,  matter-of-fact  Eng- 
lishmen, thinking  only  of  making  a  better  living. 

The  one  new  idea  which  the  founders  of  New  Zealand 
carried  with  them — and  a  very  important  one  it  was,  and 
most  interesting  to  Americans — was  that  which  revolution- 
ised the  policy  of  England  toward  its  colonies  and  gave 
them  home  rule.  The  political  foundation  of  the  present 
English  colonial  empire  was  laid  by  a  man  almost  un- 
known to  the  general  public,  though  a  man  of  genius  both 
in  thought  and  action — Edward  Gibbon  Wakefield.  Wake- 
field  was  the  first  Englishman  to  read  and  apply  the  lesson 
written  for  English  statesmen  between  the  lines  of  the 
American  Revolution.  He  took  the  lead  in  the  colonisa- 
tion of  New  Zealand,  and  secured  for  it  and  the  other  colo- 
nies of  England  the  rights  which  have  kept  Canada,  Aus- 
tralia, and,  so  far,  South  Africa,  for  the  home  country — 
the  rights  to  have  their  own  legislatures,  to  tax  themselves, 
and  to  be  free  from  all  control,  industrial  or  political,  by 
the  home  government,  except  that  a  governor-general  sent 
from  England  represents  the  Crown,  mainly  as  a  figurehead. 
He  makes  speeches  at  the  opening  of  Parliament  and  gives 
state  balls.  The  actual  government  is  in  the  hands  of  a 
ministry  on  the  English  plan,  responsible  only  to  the  colo- 
nial Parliament.  The  only  real  power  of  the  governor- 
general  is  like  that  of  the  Crown,  the  right  of  veto,  and 
that,  like  the  Crown,  he  practically  never  uses. 

The  Australasian  people  are  not  different  from  people 


OUR   LAST   CHANCE  9 

elsewhere;  they  pursue  their  self-interests  as  others  do  and 
have  no  more  fondness  for  martyrdom  than  others  have; 
but  these  English  people  found  themselves  in  a  place  and 
in  a  time  in  which  the  English  tendencies  could  run  in- 
stead of  crawl,  and  they  ran.  Of  everything  that  has  been 
done  in  Australasia,  the  germs  were  stored  in  the  older 
countries — every  one.  In  all  the  list  of  Australasian  re- 
forms there  is  nothing  bizarre,  nothing  out  of  line  with 
the  evolution  in  progress,  even  in  monarchical  countries, 
but  it  was  the  good  fortune  of  the  Australasians,  and  of 
us  who  can  see  that  they  are  experimenting  for  the  rest  of 
the  world,  that  they  could  make  the  history  we  sigh  for, 
without  making  the  revolutions  for  fear  of  which  we  do 
nothing  but  sigh.  The  importance  of  the  work  they  are 
doing  cannot  be  overestimated.  In  Australasia  the  west- 
ward march  of  empire  has  reached  around  to  the  eastern 
point  of  beginning.  Even  the  Maori  is  believed  by  the  best 
students  of  the  Polynesians  to  have  originated  in  India,  and 
so  when  the  white  man  arrived  in  Maoriland,  Aryan  met 
Aryan.  There  waited  the  last  piece  of  virgin  soil  on  earth 
where  the  white  race  can  spend  its  governing  genius,  un- 
hampered by  climate,  slavery,  monarchy,  vested  rights  and 
vested  ruts,  immigration  or  the  enervating  seductions  of 
power  over  subject  races.  As  Englishmen  admit  that 
America,  in  its  Revolution,  saved  English  constitutional  lib- 
erty, we  can  hope  that  the  Australasians,  in  their  exten- 
sion and  acceleration  of  reforms  that  are  in  the  air  every- 
where, are  saving  the  commonwealth  of  the  whole  world. 
This  Newest  England  is  no  Utopia,  no  paradise.  That 
is  self-evident  from  the  fact  that  honest,  industrious  people 
could  reach  the  age  of  sixty-five,  after  having  been  twenty- 
five  years  in  New  Zealand,  and  yet  need  an  old-age  pension. 
Both  New  Zealand  and  Australia  are  far  behind  England 
and  the  United  States  in  the  new  municipal  life,  which  is  the 


io  "THE   LEAST    BAD" 

most  promising  thing  in  our  politics,  though  as  yet  little  more 
than  a  promise.  Trades-unionism  is  still  weak  from  the  ef- 
fects of  the  catastrophe  in  which  it  was  overwhelmed  by  the 
defeat  of  the  strike  of  1890.  When  I  was  in  New  Zealand  a 
representative  body  of  workingmen  would  not  order  the 
names  of  their  officers  published  for  fear  it  would  make 
them  "marked  men"  in  the  eyes  of  their  masters.  The 
press  and  the  people  are  anxiously  discussing  the  decrease 
of  the  birth  rate,  which,  the  inquirer  learns,  is  certainly 
in  part  due  to  an  economic  pressure  which  makes  people 
afraid  to  have  children.  Just  now  New  Zealand  is  in  a 
boom  and  everybody  can  get  work,  but  it  was  only  a  few 
years  ago  that  the  reports  of  the  Secretary  of  Labour  were 
as  gloomy  reading  as  those  of  any  other  country.  The 
streets  of  the  larger  towns  swarm  at  night  with  young  men 
and  women  who,  unfortunately,  are  not  unemployed,  though 
their  hands  are  idle.  When  the  traveller  reads  the  police 
reports  of  the  principal  Australasian  cities  he  feels  as  if 
he  were  at  home  in  New  York,  London,  or  some  other 
Sodom  and  Gomorrah. 

There  is  a  sheep  ring  and  there  is  a  coal  ring  in  New  Zea- 
land— we  would  call  them  trusts — and  there  are  indications 
of  others,  such  as  a  timber  ring  and  a  combination  against 
the  sheep  farmers  among  the  great  meat-freezing  exporters. 
There  is  not  one  of  the  new  institutions  on  trial  to  deal 
with  land,  labour,  taxation,  finance  and  government  indus- 
try which  is  not  lame  somewhere,  as  any  reporter  who 
was  not  a  rhapsodist  must  declare,  but  this  experimenting 
has  this  superiority  that,  though  lame,  "it  still  moves," 
and  moves  faster  there  than  elsewhere. 

New  Zealand  has  reached  no  final  "social  solutions,"  and 
no  New  Zealander,  citizen  or  official,  can  be  found  who 
would  pretend  that  it  had.  All  that  they  claim  is  that  they 
have  tried  to  find  solutions,  and  they  believe  that  the  fair- 


NOT  THE  ONLY  EXPERIMENTERS         n 

minded  observer  will  declare  that  they  are  entitled  to  "re- 
port progress"  to  the  rest  of  us.  They  certainly  are  ex- 
perimental. They  know  it  and  are  proud  of  it,  but  do 
not  think  that  could  be  made  a  reproach  against  them  by 
the  political  heirs  of  such  experimenters  as  George  Wash- 
ington, Thomas  Jefferson  and  Samuel  Adams. 

The  tactful  portrait  painter  would  not  say  that  the  New 
Zealanders  were  the  most  civilised,  the  most  happy,  the 
most  prosperous  people  in  the  world,  but  they  certainly  are 
the  least  uncivilised,  the  least  unhappy,  the  least  disinher- 
ited. Danton's  political  genius  taught  him  to  say  of  the 
laws  and  policies  he  proposed  not  that  they  were  good, 
but  that  they  were  the  "least  bad."  There  are  no  abso- 
lutely good  governments  or  peoples,  but  some  are  not  so 
bad  as  others,  and  for  New  Zealand  it  may  be  claimed  that 
its  government  and  people  are  "the  least  bad"  this  side 
of  Mars. 


CHAPTER   II 
"OUR  MUTUAL  FRIEND" 

THE  company  that  insures  the  largest  number  of  people  in 
New  Zealand  is  the  people  itself.  The  trustee  who  exe- 
cutes the  greatest  number  of  wills,  holds  the  heaviest 
amount  of  property  and  has  the  best  clientage  is  the  people. 
Here  is  an  insurance  company  whose  policies  can  never 
become  worthless,  and  in  which  the  provision  men  make 
for  their  wives  and  children  is  safe  from  panic  or  pestilence 
without  or  rascality  within.  Any  one  who  wants  insurance 
for  the  benefit  of  his  family,  which  will  be  backed  up  by 
the  "good  faith  and  resources"  of  all  the  people,  has  only 
to  step  to  the  nearest  of  the  many  agencies  of  the  Insurance 
Department  of  the  government,  or,  easier  yet,  to  receive  a 
visit  from  one  of  its  numerous  canvassers,  kept  busy  by  the 
state  in  going  about  among  the  citizens,  pushing  the  sale 
of  this  mutual  company's  policies  as  industriously  as  the 
canvassers  of  the  great  private  companies. 

The  old  joke  of  the  young  man  who,  when  informed  by 
his  father  that  he  had  been  made  by  his  will  his  heir  and 
that  Brown  had  been  appointed  trustee,  begged  that  Brown 
might  be  made  the  heir  and  the  son  be  given  the  better  job 
of  trusteeship,  would  lose  much  of  its  point  in  New  Zea- 
land, where  there  is  a  Public  Trustee.  Here  is  a  trustee 
who  never  dies,  never  mistakes  the  money  of  his  trust 
as  his  own,  never  runs  off,  whose  wards  never  have  to  ac- 
cept explanations  instead  of  the  money  due,  and  the  bur- 

12 


A  GENIUS  IN  GOVERNMENT  13 

den  of  whose  mistakes,  if  he  makes  any,  falls  on  the  whole 
people  and  not  on  his  individual  wards.  It  is  no  wonder 
that  the  people  in  New  Zealand  hold  more  insurance  in 
proportion  than  any  other  people  in  the  world,  nor  that  the 
insurance  done  by  the  government  is  equal  in  round  num- 
bers to  that  of  all  the  private  companies  combined,  though 
these  in  the  past  have  done  their  best  to  drive  the  state 
from  the  field.  Nor  is  it  any  wonder  that  the  Public  Trus- 
tee, the  only  government  trustee  in  the  world,  should  have 
almost  a  monopoly  of  the  business  in  his  sphere. 

New  Zealand  owes  these  novelties,  the  Public  Trustee 
and  insurance  by  the  state,  to  Sir  Julius  Vogel,  to  whose 
genius  it  is  also  indebted  for  the  initiation  of  the  great 
public  works  and  assisted-immigration  scheme  of  1870,  by 
which  the  first  important  stroke  in  the  material  development 
of  New  Zealand  was  made.  An  incoming  stream  of  Eng- 
lish immigrants  and  railway  material — blood  and  iron — 
was  set  flowing  by  this  public-works  plan  of  Sir  Julius 
Vogel's  across  the  ocean  against  an  outgoing  stream  of  ten 
million  pounds  of  New  Zealand  bonds  sent  to  London. 
There  are  many  who  attribute  the  ills  which  later  befell 
New  Zealand  to  this  gigantic  creation  of  financial  indebted- 
ness, bringing  with  it  the  inspiration  and  the  material  for 
delirious  speculation  in  land,  credits,  etc.,  but  it  is  only  fair 
to  Sir  Julius  Vogel  to  remember  that  he  foresaw  all  this 
and  tried  to  prevent  it. 

It  was  part  of  his  plan  that  the  state  should  get  the 
benefit  of  the  increase  in  the  value  of  the  land  caused  by  this 
new  population  and  new  railroad  construction.  He  proposed 
that  the  government  should  reserve  the  public  lands  along 
the  railroads  for  future  sale,  and  that  a  betterment  tax  be 
laid  on  the  private  lands  opened  up.  These  measures 
would  have  given  the  people  their  share  of  the  value  their 
public  works  created.  But  this  brilliant  conception  of  eco- 


14  "OUR   MUTUAL   FRIEND" 

nomic  statesmanship  he  was  forced  to  abandon.  The  col- 
ony was  short  of  money,  long  of  land,  and  could  not  look 
far  enough  ahead  to  see  what  he  saw. 

The  prescience  with  which  Sir  Julius  Vogel  looked  into 
the  future,  and  the  success  with  which  he  administered  the 
affairs  of  the  public,  are  all  the  more  interesting  from  the 
fact  that  in  the  management  of  his  own  affairs  he  was 
notoriously  indifferent.  He  died  in  1890,  in  London,  where 
he  was  supported  by  a  moderate  pension.  His  assisted 
immigration  was  a  great  success.  All  over  New  Zealand 
one  meets  to-day  sturdy  men  and  women,  with  large  fami- 
lies, living  in  industrious  prosperity,  who  owe  their  new 
start  in  life  to  this  scheme  of  Sir  Julius  Vogel's. 

This  novelty  of  insurance  by  the  government  was  not 
the  creature  of  a  theoretical  socialism.  It  was  just  like 
the  government  railroads — a  practical  answer  of  a  prac- 
tical people  to  a  practical  difficulty.  The  people  wanted 
insurance,  but  they  were  so  far  from  the  world  and  so  in- 
significant that  private  capital  thought  them  hardly  worth 
its  notice.  Since  private  capital  would  not  undertake  it, 
the  people  used  their  government  to  insure  each  other. 

The  Life  Insurance  Department  was  proposed  in  1869 
to  the  New  Zealand  Parliament  and  passed  unanimously. 
The  new  venture  was  popular  from  the  start,  for  the  poli- 
cies had  behind  them  the  guarantee  of  the  state.  The  de- 
partment began  in  1870  with  463  persons  insured,  and  in 
1899  it  had  37,848  policies.  The  total  amount  of  insurance 
now  outstanding  is  $46,525,710.  There  have  been  paid 
out  $11,885,410,  and  the  department  now  has  on  hand 
$14,307,670.  It  has  received  in  premiums  since  its  start 
$31,257,051.  Out  of  75,692  policies  held  in  New  Zealand 
at  the  close  of  1897,  the  latest  year  for  which  these  statis- 
tics 'are  published,  36,174  were  issued  by  the  government, 
and  of  the  total  of  $98,614,850  of  insurance  represented 


STATE   LIFE   INSURANCE  15 

by  them  the  New  Zealand  government  was  responsible  for 
$45,013,005.  The  government  does  much  the  largest  in- 
surance of  any  agency  in  the  country,  and  its  transactions 
are  practically  half  the  total  done  in  the  colony. 

Although  New  Zealand  is  the  healthiest  of  all  countries, 
its  death-rate,  according  to  the  Commissioner  of  Life  In- 
surance, being  the  lowest,  its  people  are  the  most  fully 
insured.  The  government  insurance  alone  amounts  to 
more  than  $60  for  every  man,  woman  and  child,  or  $332 
for  every  grown-up  New  Zealand  man.  Including  the  in- 
surance carried  by  private  companies  there  is  an  average 
of  over  $375  for  every  New  Zealand  man,  and  of  $30  to 
$35  on  the  average  for  every  New  Zealand  woman  over 
fifteen  years  of  age.  There  could  be  no  better  test  of  the 
thrift  of  the  community  than  the  amount  of  life  insurance 
its  citizens  carry  for  the  protection  of  their  women  and 
children,  and  there  could  be  no  better  proof  than  this  New 
Zealand  thrift  that  the  self-reliance  of  the  people  has  not 
been  weakened  by  their  great  extension  of  government  func- 
tions in  aid  of  industry.  This  highly  organised  form  of 
"self-help"  has,  as  might  be  expected,  increased  and  not 
lessened  the  self-reliance  and  thrift  of  the  whole  people. 

The  government  manages  its  insurance  business  on  the 
same  lines  as  the  private  companies.  It  employs  paid  can- 
vassers, has  handsome  and  attractive  offices,  and  issues 
prospectuses  in  language  skilfully  couched  to  invite  the 
confidence  and  business  of  the  public.  The  fact  that  the 
state  is  behind  every  policy  has  been,  of  course,  one  great 
element  in  its  success.  Another  is  the  wisdom  which  has 
freed  its  policies  from  all  oppressive  conditions.  They  are, 
one  of  the  latest  prospectuses  says,  "practically  free  from 
conditions  of  any  kind  except  the  payment  of  premiums 
as  they  fall  due."  The  single  exception,  framed  in  the 
interest  of  public  policy,  is  that  the  commissioner  may  de- 


16  "OUR   MUTUAL   FRIEND" 

clare  a  policy  void  if  the  insured  commits  suicide  within 
six  months  after  taking  out  his  insurance.  "All  policies 
are  world-wide  from  the  date  of  issue."  The  insured  may 
"go  where  they  please  and  do  what  they  like,  and  if  death 
occurs  in  Central  Africa,  at  the  North  Pole,  or  on  the  bat- 
tle-field, the  policy  money  with  accrued  bonuses  will  be 
promptly  paid  to  the  relatives." 

The  Insurance  Department  pays  taxes  like  any  other  in- 
surance concern,  and  its  profits  do  not  go  to  the  Treas- 
ury, but  to  the  insured.  It  is  purely  a  mutual,  self-sup- 
porting office.  It  pays  for  its  own  postage  and  telegrams. 
At  first  its  telegrams  were  carried  free,  as  the  colony  owns 
the  wires;  but  when  the  proper  principle  was  adopted 
of  requiring  each  department  to  pay  for  what  it  received 
the  telegraph  business  of  the  Insurance  Department,  which 
when  it  went  "dead  head"  had  been  $10,000  a  year,  ran 
down  to  $1000. 

There  have  been  five  divisions  of  profits  among  the  in- 
sured, and  the  total  amount  thereby  returned  to  the  policy 
holders  has  been  $6,877,805.  There  is  a  separate  insur- 
ance under  what  is  called  the  "Temperance  Section"  for 
total  abstainers.  Any  one  who  does  not  wish  to  be  "mu- 
tually" insured  with  those  who  have  the  drink  habit  can 
be  placed  with  the  other  non-drinkers  in  this  section.  This 
experiment  began  in  1882.  As  soon  as  the  temperance  sec- 
tion was  established  the  total  abstainers  among  those  al- 
ready insured  demanded  to  be  transferred  to  it  from  the 
"general  section."  Backsliders  are  slid  back  from  the 
temperance  section  to  the  general  section.  When  this  ex- 
periment has  lasted  longer  it  will  afford  material  for  some 
interesting  comparisons  of  the  comparative  health  and  lon- 
gevity of  drinkers  and  abstainers.  In  the  division  of  profits 
of  1890  the  general  and  temperance  bonuses  were  equal. 
In  1893  the  temperance  bonuses  were  a  little  higher.  In 


THE  TEMPERANCE  SECTION  17 

1896,  however,  this  was  reversed,  and  the  general  bonuses 
were  better  than  those  of  the  temperance  section. 

The  millions  of  money  held  by  the  Insurance  Department 
are  an  important  element  in  the  financial  resources  of  the 
country.  The  department  puts  its  funds  into  national  and 
municipal  securities  and  loans  largely  on  real  estate. 

In  the  post-office  at  Cheviot,  side  by  side  with  the  old- 
age  pension  advertisements,  was  posted  this  placard  issued 
by  the  Insurance  Department : 

Cheap  Money  in  Sums  of  One  Hundred  Pounds  to 
Ten  Thousand  Pounds. 

The  Government  Life  Insurance  Department  has  large 

funds  available  for  investment  at  exceptionally 

low  rates  of  interest. 

The  Department  loans  on  first  mortgage  of  desirable  free- 
hold securities  up  to  three  fifths  of  their  value. 

Valuations  and  legal  expenses  are  fixed  by  the  Depart- 
ment and  are  kept  as  low  as  possible. 

Intending  borrowers  should  apply  within  for  forms  of  ap- 
plication and  for  all  particulars. 

J.  H.  RICHARDSON, 
Government  Insurance  Commissioner. 

Wellington,  September,  1896. 

The  growth  in  the  transactions  of  this  department  and 
the  fact  that  the  American  companies,  after  trying  compe- 
tition with  state  insurance,  withdrew  and  stayed  out  until 
1900,  tell  the  story  of  government  success.  The  Insurance 
Department  does  not  pay  as  large  bonuses  as  some  of  the 
private  companies,  but  on  the  other  hand  it  does  not  charge 
as  large  premiums.  I  took  pains  in  different  towns  of  the 
colony  to  inquire  of  its  competitors  as  to  its  methods  and 


1 8  "OUR   MUTUAL   FRIEND" 

their  results.  The  testimony  was  unanimous  and  generous 
that  the  department  was  well  managed  and  that  the  democ- 
racy had  had  the  good  sense  to  put  and  keep  experts  at 
the  head.  Some  of  the  private  companies  claimed  that 
though  their  premiums  were  larger  their  bonuses  were 
enough  larger  to  make  the  difference  more  than  good,  be- 
cause, having  greater  discretion  in  their  investments,  they 
could  earn  a  better  rate  of  interest. 

It  was  interesting  to  find  that  there  was  an  agreement 
between  the  various  companies,  including  the  department, 
not  to  "run  each  other  down."  One  of  the  managers  of 
a  very  important  Australian  company,  when  asked  what 
could  be  said  of  the  shortcomings  of  the  Life  Insurance 
Department,  replied  that  there  might  be  some  political  pres- 
sure to  get  "billets"  or  places  in  the  department,  but  not 
much.  The  average  man,  he  admitted,  was  more  likely  to 
insure  with  the  government  than  with  private  companies, 
because,  not  having  the  time  or  knowledge  necessary  to 
make  an  independent  investigation,  he  preferred  the  policy 
which  had  the  guarantee  of  the  people  behind  it. 

This  year,  in  answer  to  petitions  from  trades-unions,  Par- 
liament has  added  accident  insurance  to  the  business,  and 
put  a  stop  to  the  abuses  of  private  insurance  of  employes 
by  employers,  who  were  making  forced  deductions  from 
wages.  The  department  has  long  had  fire-insurance  busi- 
ness in  contemplation,  but  so  far  nothing  has  been  done. 
When  life  insurance  was  undertaken  there  were  no  power- 
ful vested  interests  to  oppose  the  venture,  such  as  will  now 
do  all  they  can  to  keep  the  government  out  of  competition 
with  them  in  fire  risks. 

If  compulsory  arbitration  is,  as  I  think,  the  most  impor- 
tant addition  which  New  Zealand  has  made  to  the  art  of 
society,  its  Public  Trustee  is  the  most  human  aspect  in 
which  any  people  of  our  day  presents  itself  to  the  persons 


THE   PUBLIC   TRUSTEE  19 

who  make  it  up.  This  creature  of  law,  whom  Sir  Julius 
Vogel  thought  of  only  as  an  official  depository  of  papers 
and  a  formal  agent  for  the  execution  of  the  routine  duties 
involved  in  trusts,  has  grown  into  a  functionary  with  per- 
sonality as  well  as  officiality,  touching  the  lives  of  large 
numbers  of  the  people  in  hours  of  grief,  disaster  and  help- 
lessness, not  only  with  the  ready  and  ample  resources  of 
the  state,  but  with  the  discretion  and  tenderness  of  a  wise 
friend.  If  Abou  ben  Adhem  had  his  choice  of  New  Zea- 
land offices,  this  would  be  the  one  which  he  would  take  in 
preference  to  all  others  for  his  chances  of  doing  good  and 
giving  happiness. 

The  institution  was  created  in  1872.  People  making 
their  wills  may  leave  their  property  in  the  hands  of  the 
Public  Trustee;  the  property  of  those  dying  without  will 
is  given  to  him  if  those  interested  do  not  appear,  and  fre- 
quently even  they  ask  him  to  do  the  work  for  them.  If 
the  courts  have  to  find  a  trustee,  the  best  of  all  possible 
trustees  is  ready  at  hand. 

A  man  named  by  some  relative  in  his  will  as  executor 
of  an  estate  too  distant  or  for  some  other  reason  inconve- 
nient, hands  over  the  trust  to  the  Public  Trustee.  The  con- 
ductor of  a  great  business  dies  with  no  relative  or  partner 
near.  For  the  enterprise  to  stop  means  ruin  and  the  loss  of 
everything  to  his  heirs  and  yet  they  may  be  at  the  other 
ends  of  the  earth.  The  Public  Trustee  steps  in  and  keeps 
everything  going  until  the  rightful  successors  are  found 
and  can  relieve  him.  To  this  agent  of  the  people,  cities  or 
individuals  desiring  to  create  a  public  trust  can  betake  them- 
selves. A  widow  left  property  in  different  parts  of  the 
colony,  which  she  does  not  feel  capable  of  managing,  puts 
herself  in  his  hands  and  knows  that  she  is  safe;  or,  she 
wishes  to  go  "home"  to  the  old  country,  to  see  her  friends 
and  family,  and  wants  to  be  sure  that  when  she  returns 


20  "OUR    MUTUAL   FRIEND" 

her  agent  and  her  property  will  both  be  where  she  left 
them. 

When  a  man  has  undertaken  to  manage  the  property  of 
some  dead  friend,  but  becomes  disqualified  by  illness,  or  de- 
sires to  leave  the  country,  he  has  but  to  ask  the  Public 
Trustee  to  take  his  place.  When  one  has  an  estate  of  his 
own  too  far  away  for  him  to  manage,  the  same  official 
will  manage  it  for  him  for  a  very  moderate  fee.  If  a 
philanthropist  plans  to  create  a  long-continuing  trust  to 
carry  some  generous  intention  down  to  posterity,  he  need 
spend  no  anxiety  on  the  problem  of  how  to  constitute  his 
board  of  trustees.  The  Public  Trustee  is  there  and  always 
will  be  there,  and  behind  the  Public  Trustee  is  the  public 
itself,  responsible  for  his  administration  to  the  last  dollar. 
If  a  man  or  woman  goes  crazy — and  that  happens  even  in 
paradisiacal  New  Zealand — "Our  Mutual  Friend"  assumes 
charge  of  the  property  and  conserves  it  for  the  benefit  of 
the  lunatic  and  his  next  of  kin. 

Wills,  deeds,  trusts,  or  any  other  papers  intended  to  place 
trusts  in  the  hands  of  the  Public  Trustee  are  examined  by 
him  in  advance,  free  of  charge,  so  that  there  may  be  no 
chance  of  misunderstanding  or  failure.  These  charges  for 
the  different  services  are  all  fixed  by  a  published  scale  and 
are  very  moderate,  being  intentionally  made  only  large 
enough  to  cover  the  actual  expenses  of  the  office. 

The  fame  of  the  Public  Trustee  has  spread,  and  people 
so  far  away  as  England  are  placing  property  in  his  hands. 
The  number  of  estates  in  the  department  has  grown  from 
1678  in  1890  to  2491  in  1899,  and  the  value  from  $6,200,- 
485  to  $10,551,581. 

You  do  not  have  to  wait  for  the  Public  Trustee  to  find  a 
particular  investment  for  the  property  you  place  in  his 
hands.  The  law  provides  that  the  department  shall  at  once 
begin  to  pay,  like  a  savings  bank,  a  specific  rate  of  interest 


A   FATE   WITH   A   HEART  21 

on  your  funds,  just  as  if  they  were  a  deposit.  Its  present 
rate  is  four  per  cent,  up  to  $15,000,  and  three  and  one  half 
per  cent,  above  that.  This  is  paid  quarterly  and  is  com- 
pounded until  six  years  have  passed,  after  which  simple 
interest  is  paid.  You  do  business  with  the  Public  Trustee 
under  these  very  attractive  conditions — the  state  guarantees 
you  against  loss  from  the  investment  of  your  money  in  bad 
or  insufficient  securities,  provided  you  have  left  him  to  his 
own  discretion;  it  guarantees  you  against  loss  from  delay 
in  finding  an  investment  for  your  money;  it  guarantees  you 
a  regular  rate  of  interest,  payable  at  regular  intervals,  free 
of  all  charges. 

But  the  feature  which  most  aroused  my  interest  was 
the  large  discretion  which  the  Public  Trustee  had  in  the  dis- 
charge of  his  duties  and  the  kindliness  which  this  has 
enabled  him  to  display,  like  a  good  fate,  in  the  destinies 
entrusted  to  his  care.  Private  trustees  are  tied  down  to 
the  strictest  fulfilment  of  the  letter  of  their  trust,  no  mat- 
ter how  narrow  or  mistaken ;  but  the  law  allows  the  Public 
Trustee  to  use  his  judgment  and  even  his  heart  to  make 
good  deficiencies  or  omissions  in  the  instruments  under 
which  he  acts,  and  to  do  what  the  creator  of  the  trust  must 
be  supposed  to  have  intended  or  what  he  ought  to  have  in- 
tended to  have  done. 

I  passed  few  hours  in  New  Zealand  with  deeper  interest 
than  those  I  spent  with  Mr.  John  C  Martin,  then  Public 
Trustee,  since  raised  to  the  Supreme  Court  and  made  Pre- 
siding Justice  of  the  Court  of  Arbitration,  familiarising 
myself  with  the  methods  of  his  office  and  hearing  some  of 
the  stories  of  his  administration  of  the  welfare  of  those  who 
had  become  wards  of  the  nation  under  him. 

The  Public  Trustee  is  a  Corporation  Sole ;  hence  once  he 
has  been  appointed  trustee  of  an  estate  the  trusteeship  never 
becomes  vacant,  and  it  is  immaterial  whether  the  individual 


22  "OUR   MUTUAL   FRIEND" 

for  the  time  being  holding  the  office  disappears,  resigns 
or  dies,  the  corporation  continues  and,  as  a  consequence, 
no  expense  is  ever  incurred  by  estates  in  appointing  new 
trustees. 

In  connection  with  the  Public  Trustee  there  is  a  Gov- 
ernment Board.  This  consists  of  the  Colonial  Treasurer, 
the  Native  Minister,  the  Solicitor-General,  the  Government 
Insurance  Commissioner,  the  Commissioner  of  Taxes,  the 
Surveyor-General,  and  the  Public  Trustee.  The  officials 
forming  this  board  have  been  carefully  selected  by  the  Legis- 
lature. As  the  colony  is  responsible  for  the  actions  of  the 
Public  Trustee  it  is  right  that  Ministers  of  the  Crown 
should  have  the  power  to  express  their  opinions  as  to  the 
current  business  of  the  office,  and  two  ministers  are  there- 
fore on  the  board.  Their  being  there  does  not  give  a  power 
to  the  government  of  the  day  to  control  the  affairs  of  the 
office,  because  the  ministers  do  not  form  a  majority  of  the 
board.  Ministers,  recognising  that  confidence  in  the  office 
might  be  shaken  were  it  thought  they  were  taking  part 
in  its  affairs,  never  attend  the  board  meetings.  The 
other  members  of  the  board  are  selected  on  account  of  their 
large  experience  and  intimate  acquaintance  with  the  peo- 
ple, the  affairs  of  the  colony,  the  different  districts,  the 
values  of  land,  etc.,  which  they  acquire  through  being  the 
heads  of  their  respective  departments. 

In  the  interests  of  the  colony  a  further  check  is  that 
the  Colonial  Treasurer  and  any  officer  of  the  Treasury  au- 
thorised by  him  has  access  to  all  books,  accounts,  docu- 
ments and  papers  in  the  Public  Trust  Office,  and  that  the 
Public  Trustee  shall  at  all  times  furnish  to  the  Colonial 
Treasurer  all  such  information  as  the  latter  requires.  Then, 
too,  the  Auditor-General  has  the  same  powers  in  connec- 
tion with  this  bureau  as  he  has  in  respect  of  any  department 
of  the  Civil  Service. 


THE   POST-OFFICE   HELPS  23 

The  office  of  the  Public  Trustee  is  at  Wellington,  and 
there  are  agencies  in  all  the  large  and  small  towns  in  the 
colony.  The  total  number  of  these  is  thirty-three.  In  ad- 
dition, arrangements  have  been  made  with  the  post-office  by 
which  the  Public  Trustee  is  enabled  to  receive  money  from 
any  person  at  any  money-order  office  in  the  colony,  or  pay 
it  to  them,  thus  saving  clients  the  cost  of  exchange  and 
remittance. 

Wills  are  occasionally  framed  in  such  a  manner  that, 
owing  either  to  the  testator  being  ignorant  of  his  position 
at  the  time  the  will  was  made  or  to  circumstances  having 
altered,  it  would  be  ruinous  to  carry  out  its  literal  terms. 
In  such  a  case  the  trustee  endeavours  to  do  what  is  best,  and 
if  the  majority  of  the  beneficiaries  wish  a  certain  course 
adopted,  every  effort  consistent  with  safety  to  the  office  is 
made  to  adopt  that  course,  and  even  a  certain  amount  of 
risk  is  taken  so  that  the  beneficiaries  may  derive  the  great- 
est good.  It  frequently  happens  that  a  testator  will  direct 
the  sale  of  the  whole  of  his  estate,  never  thinking  that  per- 
sonal articles,  such  as  his  ring,  watch,  and  things  of  that 
sort,  are  of  great  value  to  his  family  but  of  little  value  to 
sell.  In  such  cases  the  office  invariably  meets  the  wishes 
of  the  family  in  preserving  these  things  for  its  members, 
and  even  if  the  estate  be  insolvent,  so  that  it  is  absolutely 
necessary  to  sell  everything,  they  are  valued  and  offered 
privately  to  the  family.  Often,  too,  time  is  necessarily 
taken  up  in  getting  in  claims  and  in  realising  the  estate, 
and  in  such  a  case  the  office  makes  reasonable  advances  for 
the  maintenance  of  the  widow  and  infant  children. 

The  Public  Trustee  is  often  appointed  trustee  of  a  fund 
created  by  the  public  for  some  charitable  purpose.  After 
a  coal-mining  accident  many  years  ago,  a  public  subscription 
was  raised  and  the  fund  handed  over  to  private  trustees. 
Subsequently  such  trusts,  by  Act  of  Parliament,  were  placed 


24  "OUR   MUTUAL   FRIEND" 

in  the  Public  Trust  Office.  For  the  relief  of  the  widows 
and  orphans  of  those  killed  in  a  serious  mining  calamity 
over  £30,000  was  handed  to  the  Public  Trustee.  Under 
this  a  weekly  allowance  is  paid  to  each  widow  and  a  fur- 
ther allowance  is  paid  to  her  for  each  child  under  a  certain 
age.  These  moneys  are  remitted  to  wherever  the  widow  or 
children  may  be  and  paid  to  them.  In  some  cases  it  is  to 
their  advantage  to  receive,  instead  of  the  weekly  allowance, 
a  lump  sum,  and  that  sum  is  advanced  and  charged  against 
the  weekly  allowance.  In  one  case  a  widow  owned  a  house 
which  was  mortgaged,  and  it  was  desirable  that  the  mort- 
gage be  paid.  This  was  done  and  charged  against  her  allow- 
ance; in  another  instance  a  widow  desired  to  purchase  a 
cottage.  She  was  given  the  money,  and  her  allowance 
stopped.  The  cottage  was  bought  in  the  name  of  the  Public 
Trustee,  and  on  the  widow's  death  it  will  be  sold  and  the 
proceeds  returned  to  the  fund. 

Sometimes  the  colony  makes  a  grant  to  the  widow  of 
some  public  servant  who  has  died  in  harness,  and  the  amount 
is  handed  to  the  Public  Trustee  for  her  benefit.  Where 
the  terms  are  general,  such  as  "for  the  benefit  of  the  chil- 
dren" of  So-and-So,  he  does  what,  so  far  as  he  can  see, 
is  the  best  for  them,  possibly  an  allowance  for  board  and 
clothing.  Later  on,  as  the  children  grow  up  and  earn 
wages,  this  is  stopped  so  as  to  have  a  fund  in  hand  to 
provide  for  them  should  they  be  out  of  work,  or  to  hand 
to  them  on  their  attaining  their  majority.  In  one  instance 
a  trust  was  created  under  which  the  Public  Trustee  main- 
tains a  number  of  cottages  in  which  certain  poor  people 
are  allowed  to  live  free. 

A  man  died  leaving  a  will  under  which  his  property  went 
to  his  father,  mother,  sister,  and  brother.  Before  his  death 
he  had  been  most  anxious  to  assist  his  parents  and  sister 
and  brother,  and  as  the  two  latter  were  being  well  edu- 


THE  BOY'S   SCHOOLING   GOES   ON          25 

cated  and  their  education  could  not  be  continued  without 
assistance  from  him.  he  determined  to  pay  for  a  house  which 
was  being  built  by  his  father  for  the  family,  so  that  they 
could  live  rent  free.  Unfortunately,  before  the  house  was 
finished  he  died,  and  his  will  simply  left  the  whole  of  his 
property  to  the  family.  "It  was,  I  presume,"  the  Public 
Trustee  said,  "my  duty  to  have  paid  the  father  and  mother 
their  shares  in  cash  and  to  have  retained  the  shares  of  the 
sister  and  brother  until  they  were  twenty-one  and  then 
have  handed  the  cash  to  them.  But  had  I  done  so  this 
would  have  been  the  result :  The  father  could  not  have  fin- 
ished the  house  for  want  of  means;  the  son,  who  is  a  par- 
ticularly bright  and  promising  lad,  would  have  had  to  be 
taken  away  from  the  high  school  where  his  education  was 
being  paid  for,  and  as  he  has  passed  through  the  ordinary 
standards  at  the  state  school  it  would  have  been  useless  for 
him  to  return  to  them,  and  he  would  have  had  at  once  to 
begin  to  earn  his  living,  the  superior  education  he  has  been 
getting  for  some  time  past  being  thrown  away.  It  was  ob- 
viously much  more  to  the  interest  of  the  children  that  the 
house  should  be  finished  so  that  they  had  a  home  with  the 
ordinary  decencies  and  comforts  of  life,  that  they  should 
be  able  to  remain  with  their  parents  and  have  the  benefit 
of  parental  control  and  home  influence,  and  that  the  boy 
should  be  able  \o  continue  and  complete  his  education.  The 
father  and  mother  being  willing  that  their  money  should  be 
expended  in  completing  the  house,  the  daughter,  although 
legally  an  infant,  as  she  was  only  twenty  years  of  age,  also 
being  anxious  that  her  money  should  be  expended  to- 
ward completing  the  house  and  the  Office  Act  authorising 
me  in  Section  27  to  apply  moneys  in  my  hands  toward 
the  'maintenance,  education  and  advancement  of  any  per- 
son interested,'  I  took  the  risk  of  the  daughter  repudiating 
payment  when  she  came  of  age  and  handed  her  share  to  her 


26  "OUR    MUTUAL   FRIEND" 

father,  and  I  also  handed  the  son's  share  to  him.  This 
enabled  the  house  to  be  completed  and  the  rent  to  be  saved, 
and  the  boy's  education  continues/' 

This  public  executor  sometimes  intervenes  as  a  saving 
providence  even  in  the  case  of  property  where  a  will  has 
been  made  and  other  executors  have  been  appointed  who 
have  been  for  some  reason  delayed  in  acting.  A  man  car- 
rying on  a  sheep  ranch  died  and  by  his  will  had  appointed 
an  executor  who  was  in  Scotland.  It  was  the  busy  season 
of  the  year.  For  the  business  of  the  station  to  stop  would 
have  resulted  in  an  enormous  loss.  But  no  person  could 
act  pending  the  receipt  of  the  necessary  power  of  attorney 
from  the  executor  in  Scotland.  There  was  a  section  in  the 
law  passed  to  meet  just  such  a  case  as  this.  The  Public 
Trustee  took  charge  of  the  station,  carried  its  business  on 
successfully,  and  when  the  executor  came  from  Scotland 
there  was  little  left  for  him  to  do. 

By  the  law  the  Public  Trustee  is  to  take  charge  of  estates 
left  without  will,  unless  the  courts  see  some  reason  to  ap- 
point some  other  person,  but  as  a  matter  of  fact  this  offi- 
cial does  not  interfere  in  cases  where  there  is  a  widow 
or  children  of  the  intestate  desiring  to  wind  up  the  estate 
themselves.  The  value  of  estates  left  without  will  and 
where  there  are  no  relatives  to  administer  runs  up  often  to 
many  thousands  of  pounds.  The  Public  Trufstee  has  to  ad- 
minister for  the  well-to-do  man  who  puts  off  making  his 
will  until  it  is  too  late,  as  well  as  for  the  unknown  unfor- 
tunate who  is  found  dead  in  the  bush  or  on  the  diggings. 
Many  a  curious  and  pathetic  tale  could  be  woven  from  the 
histories  of  some  of  these  estates.  At  the  present  time  the 
office  is  administering  the  estate  of  a  man  who  was  mur- 
dered and  also  the  estate  of  his  murderer,  who,  just  before 
he  was  to  have  been  arrested,  committed  suicide. 

"In  all  cases  where  a  person  has  no  relatives  living  with 


THIRTY   TALENTS    FOR   ONE  27 

him,  the  most  careful  search  is  made  of  any  letters  or  other 
documents  which  he  may  have  either  on  his  person  or  about 
his  belongings  to  indicate  whence  he  came  or  who  his  next 
of  kin  may  be,"  Mr.  Martin  said,  "and  if  we  can  find  any 
indication  on  this  point  we  write  to  the  chief  officer  of  police 
in  the  place  indicated,  or  if  the  man  be  a  foreigner  then 
to  the  mayor  or  some  other  official  in  his  native  country, 
reporting  the  death  and  asking  that  inquiries  may  be  made, 
and  numerous  instances  happen  where  we  are  enabled  in 
this  way  to  discover  who  the  next  of  kin  are,  and  to  hand 
to  them  their  share  of  the  estate. 

"Sometimes  many  years  elapse  without  any  information 
being  forthcoming,  and  then,  possibly  in  some  quite  un- 
foreseen way,  a  clew  is  found  which,  followed  up,  enables 
the  proper  persons  to  be  paid.  Quite  recently  we  were  able 
to  hand  over  the  property  of  a  Frenchman  whose  estate 
came  into  the  office  in  1873.  No  members  of  his  family 
could  be  found  until  a  shred  of  information  came  to  us 
which  resulted  in  our  communicating  with  France,  and  we 
ultimately  sent  to  that  country  the  proceeds  of  the  estate, 
which  had  grown  from  £21  5.9.  40?.  to  £667  175.  gd.,  and 
in  another  instance  the  shares  of  infants  interested  were 
retained  for  many  years,  and  when  they  were  finally  handed 
over  they  had  increased  from  £33  los.  to  £137  lod." 

In  one  case  the  Public  Trustee  was  able  to  play,  from 
the  point  of  view  of  the  state,  a  very  self-sacrificing  part  and 
to  save  for  helpless  and  innocent  children  rights  to  which 
they  had  no  legal  title,  though  their  moral  claim  was  indis- 
putable. In  this  instance  he  acted  as  the  representative  of 
the  government  and  yet  divested  the  government  of  its 
rights  for  the  benefit  of  these  wards.  The  case  was  that  of 
a  man  possessed  of  considerable  property  who  had  intended 
to  make  his  will  in  favour  of  his  two  children,  but  had  failed 
to  do  so.  He  had  frequently  indicated  to  the  son  what 


28  "OUR   MUTUAL   FRIEND" 

properties  he  intended  to  leave  him,  and  had  told  the  daugh- 
ter how  he  intended  to  provide  for  her.  The  son,  a  grown 
man,  had  worked  as  manager  for  the  father,  knowing  that 
the  property  would  ultimately  become  his,  and  had  never 
drawn  wages.  The  daughter  kept  house  for  the  father  and 
son  without  pay.  When  the  father's  death  came,  it  was 
found  he  had  left  no  will,  and,  what  was  worse,  had  not 
been  married  to  the  children's  mother  and  his  own  parents 
had  not  been  married.  His  children  were  illegitimate  and 
unable  to  receive  any  portion  of  his  estate.  A  harder  case 
could  scarcely  be  imagined.  "Here,  strictly  speaking,"  said 
the  Public  Trustee,  "I  suppose  I  should  have  turned  the 
children  out  on  the  world  to  commence  life  how  and  as 
they  could.  Despite  all  inquiries,  no  evidence  was  forth- 
coming to  prove  the  marriage.  Under  these  circumstances 
the  estate  goes  to  the  Crown."  The  Public  Trustee  at  once 
set  himself  to  work  to  save  the  interests  of  these  innocent 
children.  He  employed  the  son  and  daughter  as  caretakers 
and  managers  of  the  estate.  He  instructed  them  how  to 
apply  to  the  government  for  the  surrender  of  the  rights  of 
the  Crown  in  their  favour,  and  in  this  application  they  were 
successful. 

Lunatics'  estates,  unless  there  is  some  one  more  interested 
to  be  put  in  charge,  are  in  the  hands  of  the  people's  agent, 
and  he  acts  on  these  general  principles:  First,  the  possi- 
bility of  the  lunatic's  recovery  is  never  lost  sight  of,  and 
every  effort  is  made  to  conserve  his  property  so  that  it  is 
available  for  him  should  he  recover;  subject  to  this,  his 
wife  and  family  have  to  be  maintained  during  the  period 
of  his  incapacity.  Very  large  powers  are  conferred  upon 
the  Public  Trustee,  and  where  the  lunatic's  estate  is  not  suffi- 
cient to  pay  for  his  maintenance  in  the  public  asylum  and 
also  to  maintain  those  dependent  upon  him,  the  government 
is  approached  and  invariably  remits  the  payment  for  main- 


SAVING  THE   HOME  29 

tenance  so  that  the  family  may  get  the  greatest  good  from 
the  property.  Often,  too,  whilst  the  income  is  not  suffi- 
cient to  pay  for  both  the  maintenance  of  the  family  and 
the  patient,  the  capital,  if  the  estate  were  realised,  would 
more  than  pay  for  the  maintenance,  but  would  leave  no 
income  for  the  family.  Arrangements  are  made  with  the 
government  for  postponement  of  payment  of  the  mainte- 
nance money  until,  should  the  patient  not  recover,  he  dies, 
thus  enabling  the  home  to  be  kept  together  until  the  chil- 
dren have  grown  old  enough  to  earn  their  own  living.  A 
case  occurred  where  the  wife  of  the  patient  left  his  land 
as  she  could  not  carry  it  on.  It  was  of  small  selling  value, 
but  a  rent  could  be  derived  from  it  which  was  more  than 
it  would,  if  turned  into  money,  produce  in  interest.  The 
wife  had  no  home,  but  her  husband  owned  a  lot  in  a  coun- 
try town,  and  the  Public  Trustee  built  a  cottage  on  it  for 
her.  The  interest  on  its  cost  was  far  less  than  the  rent  of  a 
suitable  house  would  have  been.  The  estate  is  kept  intact, 
is  made  to  produce  the  best  available  income,  and  the  wife  is 
provided  with  a  home  suitable  to  her  condition  and  is  made 
as  happy  as  circumstances  will  permit. 

Another  patient  owned  orchards  and  fruit  gardens,  but 
owing  to  his  failing  mental  health  his  affairs  had  drifted 
into  a  mess  and  the  cultivation  of  farm  and  orchard  had 
been  neglected  and  his  property  was  rapidly  depreciating 
in  value.  The  Public  Trustee  took  hold,  bought  the  neces- 
sary farm  machinery,  and  a  fair  income  is  now  being 
earned,  the  family  are  kept  together  in  a  good  home  and 
the  capital  value  of  the  property  has  been  enhanced. 

A  very  important  part  of  the  duties  of  the  Public  Trustee 
is  concerned  with  the  management  of  native  lands  scattered 
throughout  the  colony.  These  lands  the  trustee  rents  wher- 
ever possible  and  pays  the  proceeds  over  to  the  natives.  In 
his  office  we  see  the  dusky  Maoris  coming  in,  men  and 


30  "OUR    MUTUAL   FRIEND" 

women,  to  receive  the  money  clue  them.  One  of  the  para- 
doxes of  New  Zealand  life  is  that  many  white  men  live 
under  Maori  landlords. 

There  are  many  odds  and  ends  in  the  business  of  the 
department.  Any  surplus  from  the  sale  of  land  for  taxes 
is  held  by  the  Public  Trustee  awaiting  the  call  of  the  owner. 
Land,  the  owner  of  which  has  disappeared,  is  ultimately 
sold  by  the  Public  Trustee  and  the  money  held  until  the 
proper  owner  appears. 

"I  mean  to  establish  by-and-by,"  the  Public  Trustee 
said,  "a  law  department.  As  it  is,  we  do  a  great  deal  of 
law  business.  We  invest  a  large  part  of  our  funds  in 
loans  on  land  and  buildings.  The  other  day  a  working- 
man  sought  a  loan  of  one  thousand  dollars  on  his  place; 
I  accepted  it,  and  asked  him  if  he  wanted  me  to  draw  up 
the  papers  for  the  transaction.  He  preferred  that  I  should 
do  it,  and  this  is  a  common  occurrence.  We  charged  him 
thirty  shillings  for  fees,  registration,  etc.  A  lawyer  would 
have  charged  him  five  pounds  for  his  services  alone,  besides 
the  registration  fee.  We  make  wills  and  execute  other 
instruments  also  for  persons  of  small  means.  In  this  and 
other  ways  we  are  doing  a  great  deal  of  conveyancing  busi- 
ness for  the  people,  and  I  mean  to  make  it,  as  soon  as  the 
opportunity  is  ripe,  a  part  of  our  regular  duties  to  give  ad- 
vice and  draw  up  papers  for  the  people  in  all  parts  of  the 
colony."  A  still  wider  scheme  than  this  is  being  urged 
by  some  of  the  Progressives  of  New  Zealand.  They  are 
urging  the  installation  of  government  lawyers  in  every  town 
and  village  in  the  country  to  execute  papers  and  to  give  the 
people  legal  advice  at  a  minimum  charge. 


CHAPTER    III 

THE    RAILWAY    KINGS 

As  I  stood  in  the  station  of  the  government  railway  at  Well- 
ington one  day,  a  train  pulled  up,  two  or  three  times  the 
usual  length,  so  full  of  children  that  they  were  bursting  out 
of  the  doors  and  windows,  among  them  not  a  few  Maori 
boys  and  girls.  They  stormed  the  platform,  rilling  the 
air  with  the  music  of  their  greetings  and  delight,  and  catch- 
ing up  those  who  were  waiting  for  them,  scattered  through 
the  streets  of  the  city.  It  was  an  excursion  of  seven  hun- 
dred school  children  from  Masterton,  come  with  their  teach- 
ers to  get  a  day's  pleasure  and  instruction  out  of  the 
metropolis. 

A  few  days  afterward  a  train  left  the  same  station  as  full 
of  city  children  to  be  taken  into  the  country. 

These  excursions  are  one  of  the  specialties  of  the  owner- 
ship of  the  highways  by  the  people  in  New  Zealand. 

The  ideal  of  the  democracy  is  to  run  its  roads  for  service, 
not  for  profit.  "After  we  have  earned  enough  to  pay  the 
expenses  of  operation  and  the  interest  on  the  money  bor- 
rowed to  build  the  railroads,"  the  Minister  for  Railways 
says,  "we  reduce  charges  as  rapidly  as  profits  increase." 

The  Premier  in  a  speech  during  the  last  campaign  defined 
the  railroad  policy  to  be  that  any  profit  over  the  three  per 
cent,  needed  to  pay  interest  on  its  cost  must  be  returned 
to  the  people  in  lower  rates  and  better  accommodations. 

In  these  school  excursions  children  under  fifteen  years  of 


32  THE    RAILWAY    KINGS 

age  are  carried  at  rates  so  low  that  to  go  one  hundred  miles 
and  back,  a  possible  ride  of  two  hundred  miles,  costs  only 
fifty  cents  (2s.)  or  four  miles  for  a  cent. 

Older  children  and  the  teachers  pay  one  dollar  for  the 
same  distance.  These  rates  make  it  possible  for  the  chil- 
dren from  up  country  to  come  to  the  city,  to  see  the  harbor 
and  ocean-going  steamers  and  the  stir  of  commerce.  And 
town  children  are  taken  out  to  the  foot  of  the  mountains,  to 
look  at  waterfalls  and  fern  trees,  and  hear  the  tui  bird 
ring  its  silver  bell.  The  number  of  children  and  teachers 
and  guardians  who  take  these  excursions  amounts  in  one 
year  to  one  seventh  of  the  population. 

Children  of  the  primary  grades  are  carried  free  on  the 
railroads,  but  not  farther  than  the  next  school.  South  Aus- 
tralia, New  South  Wales  and  Queensland  also  carry  their 
school  children  free. 

Scholars  who  want  to  go  farther  and  those  of  the  higher 
grades  can  have  season  tickets,  second  class,  for  any  distance 
up  to  sixty  miles,  getting  a  possible  one  hundred  and  twenty 
miles  a  day  of  transportation  for  two  dollars  and  a  half  to 
five  dollars  ( 10^.  to  2Os. ) ,  according  to  age,  for  three  months. 
For  the  benefit  of  teachers  who  wish  to  attend  Saturday 
training  classes,  a  special  ticket  is  issued,  good  for  four 
months  and  for  any  distance,  for  seven  dollars  and  a  half; 
and  there  are  special  tickets  also  for  boarding  school  chil- 
dren returning  home  for  the  holidays. 

The  working  people  are  given  the  same  rates  for  holiday 
trips  as  the  young  school  children.  The  men  and  women  in 
the  factory  can  take  their  children,  under  fifteen  years  of  age, 
to  go  for  a  summer  day's  outing  at  the  same  rate  as  if  they 
were  teachers  with  scholars.  They  can  go,  for  instance, 
fifty  miles  out  and  back,  or  one  hundred  in  all,  for  sixty- 
eight  cents  (2s.  9^.)  each  for  the  grown  ups  and  twenty- 
nine  cents  (is.  2d.)  for  the  little  ones. 


FIFTY   CENTS   A  WEEK  33 

A  good  beginning  has  been  made  in  a  service  of  work- 
ingmen's  trains  between  the  cities  and  the  suburbs.  Morn- 
ing and  evening  trains  are  run  out  from  the  principal  towns 
to  the  suburban  limits  at  a  fare  of  fifty  cents  a  week.  But 
these  are  open  to  all  travellers,  for  there  is  strong  opposition 
to  the  whole  policy  of  class  trains  and  class  settlements  for 
workingmen  as  undemocratic  and  tending  toward  the  pro- 
duction of  caste. 

The  parcel  system  is  cheap  and  simple.  A  seven-pound 
parcel  can  be  sent  thirty  miles  for  twelve  cents  (6d.),  and 
any  distance  by  rail  in  the  colony  for  twenty-five  cents. 
Fourteen  pounds  go  one  hundred  miles  for  twenty-five 
cents  and  any  distance  for  fifty  cents.  It  costs  only  seventy- 
five  cents  to  send  twenty-five  pounds  any  distance.  The  rates 
on  large  parcels  are  intentionally  made  very  high  in  com- 
parison, in  order  that  the  heavy  business  may  go  by  freight. 
The  adoption  of  these  parcel  rates  has  been  followed  by  a 
great  increase  in  the  traffic. 

Newspaper  publishers  can  send  three  pounds  seventy-five 
miles  for  two  cents  (id.),  and  the  highest  rate  for  any  dis- 
tance is  six  cents.  A  bundle  of  one  hundred  and  twelve 
pounds  of  newspapers  goes  any  distance  for  fifty  cents. 

The  libraries  are  recognised  to  be  as  much  entitled  to 
special  consideration  as  schools,  and  books  are  taken  to  and 
fro  between  libraries  and  their  subscribers  at  one  quarter  the 
parcel  rates. 

To  help  farmers  to  market  their  fruit  and  vegetables  "if 
fresh  and  New  Zealand  grown  and  packed,"  fifty-six  pounds 
will  be  taken  any  distance  for  twelve  cents.  A  visitor  re- 
turning to  the  city  can  bring  with  him  any  of  the  trophies 
of  the  garden  of  the  "old  home"  as  excess  baggage  at  the 
same  rates. 

The  railroads  will  bring  the  farmers  lime  to  warm  their 
soil  free  of  charge;  and  a  stallion,  brood  mare,  ram,  shep- 


34  THE    RAILWAY    KINGS 

herd  dog,  or  any  other  domestic  animal  for  breeding  is  car- 
ried free.  To  encourage  the  use  of  clean  seeds  shipments 
by  farmers  to  seed-cleaning  establishments  are  returned  free 
of  all  railroad  charges. 

If  a  farmer,  breeder,  manufacturer  or  other  exhibitor  at 
an  agricultural  or  animal  show  fails  to  sell  the  whole  of  his 
exhibit,  it  will  be  carried  back  free  by  the  railroads.  If  he 
fails  to  sell  any  of  it,  it  is  not  only  carried  back  free,  but  one 
half  of  the  forward  charge  is  returned  to  him. 

The  New  Zealand  railroad  tariff  is  literally  a  "protective 
tariff."  Slate  for  house  fittings  if  imported  has  to  pay 
twelve  dollars  per  ton,  where  slate  of  New  Zealand  manu- 
facture pays  only  ten  dollars.  The  protective  freight  rate 
against  imported  paper  bags  and  in  favour  of  the  domestic 
article  is  almost  double,  and  so  on  with  other  things. 

Donations  of  food  products  for  charitable  institutions  are 
carried  at  half  rates. 

Materials  for  making  roads  pay  only  half  the  regular 
rates,  because  "roads  are  feeders  for  the  railroads."  All 
these  concessions  in  rates  have  been  followed  by  an  increase 
in  the  revenue. 

As  the  state  in  New  Zealand  considers  transportation  a 
public  business,  it  naturally  has  assumed  charge  of  the  paths 
and  facilities  for  travellers,  explorers  and  mountain  climb- 
ers throughout  a  large  part  of  the  colony.  On  the  way  to 
Milford  Sound,  where  mountains  crowned  with  perpetual 
snow  keep  the  ocean  as  calm  in  their  embrace  as  an  Italian 
lake,  the  traveller  goes  along  a  pathway  opened  and  kept  in 
order  by  the  government ;  sleeps  at  night  in  its  huts ;  travels 
in  steamboats  which  are  either  owned  or  subsidised  by  it; 
refers  to  guide  books  which  are  prepared  and  printed  by  it, 
and  is  in  the  hands  of  guides  who  are  also  its  employes. 

The  "Hermitage"  at  Mt.  Cook  is  the  property  of  the  state, 
and  is  not  only  owned  but  run  by  it,  and  run  well. 


ONE  TON  OR  A  MILLION  35 

New  Zealand  railroad  science  knows  nothing  of  the  doc- 
trine that  a  shipper  because  the  largest  is  entitled  to  the  low- 
est rate,  to  say  nothing  of  the  claim  that  the  railroad  manager 
has  the  right  to  give  such  favouring  rates  as  to  make  the 
shipper  he  prefers  the  largest,  even  though  he  start  as  the 
smallest.  Here,  as  in  its  land  policy,  the  country  deliberately 
and  from  reasoned  conviction  approves  the  opposite  policy 
of  favouring  the  small  man. 

Men  who  cannot  ship  by  the  ton  are  given  a  rate  for  four 
hundred  pounds  at  a  very  small  difference  on  the  ton  rate. 
The  settler  who  brings  down  to  the  station  his  one  bale  of 
wool  gets  as  low  a  rate  as  the  company  that  sends  off  its 
thousands  of  bales. 

In  New  South  Wales  where  the  merchant  must  ship  six 
tons  of  any  article  to  get  the  best  rate  the  small  men  com- 
plained that  this  gave  the  advantage  to  their  larger  rivals. 
This  was  met  by  relaxing  the  requirement  that  the  six  tons 
must  be  of  one  article,  and  allowing  the  required  amount  to 
be  made  up  of  assorted  lots.  Russia  does  still  better  and 
takes  a  hundred-pound  package  from  the  small  men  at  the 
same  rate  that  it  charges  the  great  dealer  who  ships  tons  or 
train-loads. 

Such  a  thing  as  a  rebate  or  a  discrimination  in  favour  of 
one  shipper  against  another  is  unknown  in  New  Zealand. 
No  would-be  commercial  conqueror  can  get  the  traffic  man- 
ager of  the  New  Zealand  railroads  to  make  him  a  rate  which 
will  drive  his  competitors  out  of  business. 

In  discussing  this  matter  with  one  of  the  railroad  officials, 
I  asked  him  what  the  unit  of  shipment  was  in  coal.  The 
rates  for  coal,  he  said,  were  made  by  the  ton. 

"Could  a  man,"  I  asked  him,  "ship  ten  thousand  tons  and 
get  a  lower  rate  than  the  man  who  shipped  one  thousand 
tons?" 

"No,"  he  replied,  "not  if  he  shipped  ten  million  tons." 


36  THE    RAILWAY    KINGS 

"There  is  no  such  thing  known  in  the  country  as  a  re- 
duction in  rates  for  any  quantity,"  the  general  manager 
said.  And  the  officials  of  the  private  roads,  of  which  there 
are  one  or  two,  were  as  emphatic  that  no  such  practice  ex- 
isted on  the  government  roads. 

I  made  inquiries,  both  of  the  railroad  men  and  shippers, 
all  through  New  Zealand,  South  Australia,  New  South 
Wales,  Victoria  and  Queensland,  and  satisfied  myself  that 
such  a  thing  as  discrimination  between  shippers  in  rates, 
in  cars  or  in  other  conditions,  is  unknown  under  the  Austra- 
lasian regime  of  public  ownership. 

The  nearest  approach  to  it  I  found  in  New  South  Wales. 
Here  there  are  discriminations  but  with  no  touch  of  favour- 
itism. The  Commissioner  of  Railroads  has  power  to  make 
special  rates  for  persons  and  places  he  thinks  it  desirable 
to  foster,  as  in  the  case  of  new  districts  or  enterprises  oper- 
ated under  certain  disadvantages,  such  as  great  distance 
from  market. 

To  stimulate  the  foreign  trade,  the  rate  on  wheat  sent  to 
Sydney  for  export,  is  much  less  than  on  wheat  going  there 
for  home  use. 

Commissioner  Oliver  showed  me  instances  of  special 
rates,  lower  than  those  given  the  general  trade,  which  he  had 
conceded,  as  in  the  case  of  coal  and  iron  mills  which  had  an 
unusually  long  haul;  but  in  no  such  cases,  even  though  the 
rate  is  lower  proportionately  than  that  others  enjoy,  is  the 
total  charge  made  lower.  The  very  distant  enterprise  may 
be  relieved  of  paying  the  full  tariff  rate  per  mile,  but  its 
total  payment  is  more  than  the  concerns  in  competition 
which  are  nearer  the  market. 

The  railroad  commissioners  may  use  their  discretion  and 
give  distant  men  a  chance  to  compete  on  more  equal  terms, 
but  they  cannot  go  as  far  as  railroad  men  have  been  known 
to  do  under  the  regime  of  private  ownership  and  make  the 


NO   FAVOURED   SHIPPERS  37 

total  charge  the  lowest  to  the  men  farthest  away.  "The 
company,  especially  if  it  be  a  large  one,"  the  official  ex- 
plained, "may  get  a  smaller  rate  per  mile,  but  its  total 
charge  will  be  greater  so  that  the  other  companies  cannot 
be  frozen  out." 

Questioning  the  commissioners  of  the  other  colonies  I 
found  that  the  power  exercised  in  New  South  Wales  was 
not  in  use  elsewhere.  The  South  Australian  Minister  for 
Railways  said,  "We  never  make  any  discriminations  in  rates 
except  to  give  free  transportation  to  large  shippers  accord- 
ing to  a  published  scale."  He  regarded  the  New  South 
Wales  practice  as  very  dangerous. 

The  Queensland  roads  make  no  concessions  to  large 
shippers.  The  only  special  rates  are  on  products  to  go 
abroad. 

One  of  the  chiefs  of  the  Victorian  service  characterised  the 
New  South  Wales  policy  of  discrimination  in  vigorous 
terms  as  "deliberate  injustice."  "We  would  not  do  that," 
he  said,  "for  any  person  or  any  corporation."  Victoria 
makes  special  rates,  open  to  all  shippers,  for  districts  where 
it  is  necessary  to  meet  competition  by  steamboats  or  by  the 
railways  of  other  colonies. 

The  New  South  Wales  discriminations  are  not  "secret" 
discriminations  and  there  is  no  possibility  of  private  favour- 
itism. No  special  rates  can  be  given  unless  the  commis- 
sioner lays  all  the  circumstances  before  his  colleagues  in 
the  government  and  succeeds  in  securing  the  approval  of 
the  Governor-in-Council,  corresponding  to  our  President 
and  cabinet.  The  rates  must  then  be  "gazetted,"  that  is, 
published,  and  any  person  aggrieved  is  given  seven  days  to 
be  heard  in  protest. 

Furthermore,  in  the  quarterly  reports  of  the  Railway 
Department,  every  such  concession  must  be  itemised  sepa- 
rately and  explained.  "There  has  never  been  a  complaint 


38  THE   RAILWAY    KINGS 

or  protest,"  the  commissioner  said,  "nor  a  Parliamentary 
question  about  any  discrimination  in  rates.  No  individual 
has  ever  come  forward  with  a  grievance." 

In  all  the  colonies  railroad  charges  are  regarded  as  tax- 
ation. The  principle  of  "taxation  according  to  ability  to 
pay"  becomes  in  railroad  parlance  the  rule  of  "charging 
what  the  traffic  will  bear." 

Rates  favouring  producers  shipping  for  export  are  an 
acknowledged  feature  of  the  railroad  management  all 
through  Australasia. 

These  concessions  in  the  rates  on  produce  for  shipment 
abroad  are  made  to  meet  foreign  competition  and  to  help 
accumulate  in  London  the  funds  on  which  to  draw  to  pay 
the  interest  on  the  government  debt. 

"We  can  afford,"  said  one  of  the  New  Zealand  railroad 
officials,  "to  help  the  men  who  are  producers,  if  we  make  it 
up  on  the  men  who  drink  the  tea  and  buy  the  dry-goods.  So 
we  make  the  merchandise  pay  and  favour  the  producers." 

"Political  pressure"  is  the  great  bugbear  of  public  owner- 
ship. Politicians  "pulling"  to  get  their  henchmen  jobs; 
local  statesmen  "log  rolling"  with  each  other  to  have  roads 
built  in  their  districts,  which  if  the  public  interest  were  the 
standard  would  be  built  anywhere  but  there;  "influence"  that 
manipulates  rates  to  the  injury  of  men  or  sections  with  less 
"influence" ;  the  "railway  vote"  thrown  in  solid  mass  by  the 
corrupt  administration  to  keep  itself  in  power  forever — these 
are  the  nightmares  invoked  to  haunt  the  dreams  the  people 
are  dreaming  of  days  to  come  when  they  will  own  their  own 
railroads.  This  seeking  of  office  and  appropriations  and 
favours  at  the  cost  of  all  for  the  few,  comes  from  a  kind  of 
human  nature  which  is  found  in  Australia  as  it  is  everywhere 
else.  But  over  against  it  there  is,  in  Australia,  as  every- 
where else  in  this  world,  struggling  "to  free  its  hinder 
parts,"  another  human  nature  which  is  seeking  to  control  it. 


TESTS  FOR  STATE  OWNERSHIP  39 

Where  shall  the  new  lines  be  built? 

How  shall  the  new  employes  be  selected  ? 

How  shall  promotion  and  conditions  of  employment  be 
determined  ? 

How  shall  rates  be  fixed  ? 

These  are  the  questions  that  private  ownership  seems  to 
think  are  unanswerable  posers  for  public  ownership.  But 
they  are  questions  which,  though  they  have  proved  trouble- 
some in  Australasia,  have  not  been  found  unanswerable. 

The  building  of  new  lines  is  left  in  New  Zealand  wholly 
to  the  initiative  of  Parliament,  which  acts  on  the  initiative 
of  the  Ministry,  which  in  its  turn,  acts  on  the  initiative  of 
the  people. 

The  New  Zealand  newspapers  are  full  of  the  reports  of 
meetings  held  by  the  people  in  various  districts  urging  the 
claims  of  this  or  of  that  new  line  on  the  attention  of  the  min- 
ister of  the  day,  and  pledging  their  representatives  in  Parlia- 
ment to  work  for  it. 

Auckland  in  the  north  has  not  yet  been  connected  with 
Wellington,  the  capital,  at  the  south;  and  at  a  large  and 
enthusiastic  meeting  before  the  last  election  resolutions  were 
passed  that  no  candidate  should  be  supported  for  Parlia- 
ment who  would  not  bind  himself  to  the  ardent  promotion  of 
this  missing  link. 

Where  new  roads  are  to  be  built  is  settled  in  New  Zea- 
land by  the  democracy,  by  the  democratic  methods  of  agi- 
tation, petition,  election  and  legislation. 

In  the  Australian  colonies,  however,  for  this  reliance  on 
the  methods  of  democracy,  there  has  been  substituted  in  the 
construction  of  new  lines  a  complicated  system  of  checks. 

In  South  Australia  no  bill  for  the  construction  of  a  new 
railroad  can  be  considered  by  Parliament  until  a  sealed  re- 
port has  been  laid  on  the  Speaker's  desk  from  the  railroad 
department  along  with  the  bill. 


40  THE   RAILWAY   KINGS 

In  Victoria,  when  a  new  railroad  is  proposed  in  Parlia- 
ment, the  project  must  be  referred  to  a  special  Parliament- 
ary committee,  which  has  been  created  for  that  purpose.  The 
severe  financial  depression  which  began  in  1893,  followed 
close  upon  a  period  of  great  apparent  prosperity,  during 
which  large  sums  of  borrowed  money  from  London  had  been 
expended  on  the  construction  of  new  railroads.  Land  rap- 
idly increased  in  price,  and  business  of  all  kinds  was  pros- 
perous. The  passenger  and  freight  revenue  reached  a  high 
figure.  With  these  bright  prospects  bills  for  the  construc- 
tion of  hundreds  of  miles  of  new  railroads,  involving  a  fur- 
ther large  expenditure  were  introduced  into  Parliament. 

With  the  panic  came  the  realisation  that  the  apparent  pros- 
perity of  the  country  was  not  stable,  and  Parliament  sought 
a  system  by  which  the  recurrence  of  such  extravagant  con- 
struction could  be  prevented.  A  standing  committee  was 
created  of  nine  members,  six  from  the  lower  house,  three 
from  the  upper,  to  whom  all  bills  must  be  referred. 

Now  the  minister,  after  obtaining  a  report  from  the  rail- 
road commissioner  as  to  the  probable  traffic  and  working 
expenditure  of  any  proposed  line,  submits  the  project  to 
Parliament  and  moves  that  it  be  referred  to  this  committee. 
This  is  required  to  deal  with  all  proposals  separately,  and  a 
second  proposal  may  not  be  referred  to  it  until  the  first  has 
been  reported  on  and  the  report  dealt  with  by  the  Legislative 
Assembly.  The  Assembly  is  required  to  declare  that  it  is, 
or  is  not,  expedient  to  carry  out  the  work,  or  it  may,  if  it 
pleases,  refer  back  the  report  or  a  portion  of  it. 

If  it  be  declared  inexpedient  to  proceed,  no  further  pro- 
posal for  the  same  work,  or  one  in  substance  identical, 
is  allowed  to  be  submitted  to  the  Assembly  within  twelve 
months  unless  the  Governor-in-Council,  by  order  of  the 
committee,  declares  it  to  be  in  the  public  interest  that  the 
matter  should  be  re-submitted  to  the  Assembly. 


EXTRAVAGANT  CONSTRUCTION     41 

If  the  Assembly  decides  that  it  is  expedient  to  proceed 
with  the  work,  the  minister  is  required  to  prepare  and  sub- 
mit a  bill  authorising  it.  This  may  be  amended  as  Parlia- 
ment may  think  fit  and  when  passed  the  authorisation  of 
the  new  road  is  complete. 

The  Victorian  commissioner  who  considers  himself  re- 
sponsible, and  is  responsible,  for  the  balance  of  revenues 
and  expenses  cannot  admit  merely  public  considerations  into 
his  judgment  of  proposed  lines. 

Parliament  may  decide,  and  quite  properly,  in  view  of  the 
future  good  to  the  community,  in  favour  of  a  line,  but  if 
that  line  will  not  pay  immediately,  the  commissioner  sees 
a  great  deficit  threatening  him  and  popular  condemnation 
falling  on  his  administration.  It  would  be  surprising  if 
the  commissioner  under  such  circumstances  always  agreed 
with  the  standing  committee,  and  there  are  sometimes  sharp 
collisions  between  him  and  it. 

In  one  case  I  learned  of,  this  standing  committee  recom- 
mended a  line  which  the  commissioner  unqualifiedly  con- 
demned. There  were  only  three  hundred  settlers  in  the 
country  which  was  to  be  given  the  new  road  and  the  com- 
missioner told  Parliament  that  it  would  be  cheaper  to  buy 
them  all  up  than  to  build  where  the  cost  could  not  possibly 
be  repaid.  Notwithstanding  his  protest  the  line  was  recom- 
mended by  the  committee.  It  was,  however,  not  built,  as  the 
commissioner  blocked  it  by  declaring  that  if  built  as  pro- 
posed he  could  not  accept  it  and  would  not  work  it,  as  it  was 
too  cheap  in  its  construction  to  be  safe. 

In  New  South  Wales  Parliament  decides  upon  hew  lines, 
but  the  views  of  the  Railway  Commissioner  must  first  be 
called  for,  as  in  South  Australia  and  in  Victoria. 

When  I  was  in  Queensland,  I  found  projects  for  new  rail- 
ways in  Parliament  involving  a  hundred  million  of  dollars. 
As  this  was  a  great  deal  more  than  the  value  of  all  the  roads 


42  THE   RAILWAY    KINGS 

already  built,  it  was  evident  that  Queensland  was  in  need 
of  some  such  restraining  influence  as  that  found  for  them- 
selves by  the  other  colonies  in  the  measures  already  de- 
scribed, and  a  Parliamentary  Standing  Committee  to  sift 
and  pass  upon  these  schemes  was  under  contemplation. 

Rates  are  fixed  in  New  Zealand  by  the  Minister  for  Rail- 
ways, and  in  the  other  colonies  by  the  commissioners. 
Neither  minister  nor  commissioners  make  any  important 
changes  without  consultation  with  the  Cabinet.  In  all  the 
colonies,  changes  must  be  "gazetted"  for  the  information  of 
the  public.  Great  power  is  given  the  commissioners.  An 
advisory  board  of  high  grade  railway  officers  has  been 
created  to  assist  the  Chief  Commissioner  of  Victoria,  but 
he  can  as  he  chooses,  regard  or  disregard  their  advice. 

In  all  the  colonies  the  ultimate  power  over  rates,  as  over 
everything,  is  in  Parliament,  but  there  is  this  difference  be- 
tween the  ministerial  and  commissioner  systems.  Under 
the  former,  the  dissatisfaction  of  the  people  can  reach  the 
railroads  immediately,  for  the  ministry  of  the  day  can  be 
overthrown  by  the  loss  of  a  majority.  But  under  the  other 
system,  the  commissioners  are  appointed  for  fixed  terms,  and 
can  be  removed  only  by  the  joint  action  of  both  houses  of 
Parliament,  through  very  complicated  proceedings,  which 
practically  can  be  invoked  only  in  cases  of  extreme  mis- 
conduct. 

Jobs  involving  the  construction  of  new  lines,  necessarily 
take  time,  but  the  appointment  of  "my  friend  here"  is  so 
little  a  "favour"  that  it  can  be  sprung  on  a  commissioner  or 
a  minister  at  all  times  and  by  any  one  who  has  or  thinks  he 
has  a  "pull." 

The  democracy  is  fully  aware  of  this  evil  of  "patronage," 
and  has  been  very  thorough  in  dealing  with  it  in  New  Zea- 
land and  all  the  other  colonies. 

In  Victoria  entrance  to  the  railway  service  is  by  examin- 


IF   THERE   IS   A   GENIUS  43 

ation,  of  which  public  notice  must  be  given  with  all  particu- 
lars necessary  for  the  information  of  applicants.  All  candi- 
dates have  to  stand  a  physical  as  well  as  an  educational  test. 

Among  other  things,  the  law  requires  that  the  notice  state 
that  any  person  who  attempts  to  influence  any  member  of 
the  "Board  of  Selectors"  shall  be  forever  disqualified  for 
employment  in  the  railway  service. 

If  more  men  pass  the  examination  than  there  are  places 
for,  they  meet  and  cast  lots  to  determine  who  shall  have  em- 
ployment; and  the  commissioner  must  appoint  them  in  the 
order  determined  by  this  lot,  and  "in  no  other  way," 

The  successful  candidates  enter  the  service  at  the  bottom 
as  probationers  only.  Vacancies  occurring  in  the  upper 
branches  must  be  filled  by  promotion  in  regular  order  from 
the  officers  next  in  rank.  No  one  can  be  passed  over  unless 
the  head  of  his  branch  recommend  in  writing  that  it  be  done, 
and  the  individual  thus  slighted  has  the  right  to  appeal  to 
the  commissioner. 

"You  must  sometimes  need  an  expert,  a  man  with  special 
qualifications,  whom  you  could  not  secure  by  this  method  ?" 

"We  provide  for  that.  The  commissioner  in  such  a  case 
makes  a  certificate  that  there  is  no  one  in  the  department 
qualified  for  the  service  in  question,  and  is  then  given  power 
by  the  Executive  Council  to  appoint  from  the  outside." 

"Suppose  you  discover  a  genius  among  your  men  ?  How 
can  you  get  him  up  to  the  higher  place  where  you  want  him, 
in  the  face  of  this  hard  and  fast  provision  that  promotion 
shall  be  only  in  due  order?" 

"We  are  not  often  troubled  by  such  a  discovery  ;'but  if  we 
are  we  have  no  trouble  in  putting  the  exceptional  man  where 
he  should  be.  We  simply  put  him  there;  but  the  head  of 
his  department  must  file  a  written  statement  that  the  men 
over  whom  he  has  been  lifted  are  not  fit  for  the  work,  and 
any  official  who  feels  himself  wronged  can  appeal." 


44  THE    RAILWAY   KINGS 

In  New  South  Wales  the  hearing  of  employes  with  griev- 
ances is  given  special  importance  by  being  made  the  only 
matter  that  requires  the  presence  of  all  the  commissioners. 
Men  wishing  to  raise  questions  of  promotion  or  change  of 
wages  or  treatment,  have  a  right  to  be  heard  by  all  three 
members  of  the  board.  It  needs  but  two  of  the  three  com- 
missioners to  make  an  ordinary  contract,  but  differences 
with  the  employes  can  be  heard  and  decided  only  by  the  par- 
ticipation of  them  all. 

In  New  South  Wales  the  politicians  and  office-seekers 
have  been  barred  out  by  the  creation  of  a  Civil  Service  board 
with  unusual  powers.  This  board  makes  periodical  investi- 
gations of  the  conditions  of  public  service  and  has  dis- 
cretion which  it  has  freely  used  to  abolish  offices,  to  reduce 
salaries  where  extravagant,  and  to  systematise  admission 
and  promotion. 

This  board  practically  controls  the  civil  service  subject  to 
laws  requiring  examination  and  promotion.  Appointments 
and  promotions  can  be  made  only  by  its  certificate.  It  has 
been  made  independent  of  immediate  Parliamentary  inter- 
ference as  the  railroad  commissioners  are.  A  vote  of  both 
houses  of  Parliament  is  necessary  for  its  removal,  and  its 
salaries  are  not  matters  of  annual  appropriation,  but  were 
appropriated  to  the  necessary  amount  out  of  the  general  rev- 
enue at  the  time  of  the  creation  of  the  board. 

By  this  institution  in  New  South  Wales  the  politicians 
have  been  completely  routed,  I  was  assured.  "They  never 
show  their  heads  here,"  said  one  of  the  members  of  the 
board.  "They  have  nothing  to  say.  The  politicians  have 
absolutely  no  patronage,  and  the  board  has  none." 

This  Civil  Service  board,  the  secretary  of  which  is  the 
eminent  Australian  statistician,  T.  A.  Coghlan,  has  such  au- 
thority that  the  engineers  on  public  works  cannot  transfer 
a  foreman  from  one  job  to  another  without  its  consent. 


AN   ARBITRATION    COURT  45 

The  people  of  New  Zealand,  whether  less  sophisticated  or 
more  confident  of  their  own  democracy,  have  not  had  re- 
course to  such  a  board.  They  regulate  admission  and  pro- 
motion by  law,  but  leave  the  practical  work  of  the  civil 
service  to  the  good  sense  and  virtue  of  the  members  of  the 
government. 

New  Zealand  demands  an  educational  qualification  of  its 
railroad  employes  as  it  does  of  its  factory  hands.  Every 
applicant  for  a  place  or  "billet"  on  the  railway  must  produce 
his  school  certificate.  He  cannot  get  a  job  as  a  labourer  to 
wheel  a  barrow  or  to  lay  rails  unless  he  has  a  certificate  from 
the  government  schools,  or  one  from  some  equivalent  ex- 
amination elsewhere,  and  the  applicants  for  the  higher  posi- 
tions must  have  higher  certificates.  These  certificates  take 
the  place  of  the  examination  required  in  Victoria. 

But  examinations  are  required  in  New  Zealand  for  pro- 
motion. No  one  can  secure  a  place  on  the  railway  if  the 
service  already  contains  two  members  of  his  family. 

The  New  Zealand  force  is  thoroughly  "classified,"  so  as 
to  insure  that  promotions  shall  be  made  only  in  order,  ac- 
cording to  priority  and  length  of  service,  etc.  But  notwith- 
standing this  the  genius  can  be  promoted  if  he  can  be  found. 
The  head  of  the  department  gives  a  certificate,  as  in  Vic- 
toria, that  the  men  over  whom  he  is  to  be  jumped  are  not 
able  to  do  the  work  required.  The  intermediate  men  have  a 
right  to  go  to  an  Appeal  Board,  and  in  the  election  of  this 
Appeal  Board  all  the  members  of  the  railway  force  have  a 
voice. 

The  condition  of  the  railway  men  as  to  promotion,  pay 
and  treatment  are  much  lightened  in  New  Zealand  by  the 
existence  of  this  Appeal  Board,  which  is  a  sort  of  arbitra- 
tion court  for  the  railway  men,  and  by  the  right  of  every 
officer  and  employe  to  take  part  in  the  election  by  which  the 
board  is  constituted. 


46  THE   RAILWAY   KINGS 

The  board  has  three  members ;  one  appointed  by  the  gov- 
ernment, one  elected  by  the  officers,  and  one  elected  by  the 
men.  Every  railway  man,  no  matter  how  obscure,  has  the 
right  to  a  vote  for  a  representative  on  this  board  and  to  go 
before  it  with  his  complaints  against  dismissal,  reduction  in 
rank  or  cut  in  pay,  or  any  other  question  between  himself 
and  his  department.  He  can  also  bring  before  this  board 
any  preference  to  other  employes  which  he  considers  to  in- 
volve injustice  to  himself. 

The  employes  of  the  railroad  do  not  have  to  remain  silent 
under  a  sense  of  wrong,  nor  do  they  have  to  take  their  griev- 
ances before  a  superintendent  independent  of  themselves. 
The  member  of  the  Board  of  Appeal  who  sits  there  as  a 
direct  representative  of  the  employes,  put  there  by  their 
votes,  sees  that  the  evidence  they  want  to  give  is  received. 
And  when  their  case  is  under  consideration  by  the  board  he 
is  there  as  spokesman  for  them. 

In  the  year  1899  there  were  only  five  cases  before  the 
board.  Of  these  one  was  decided  in  favour  of  the  men; 
four  were  dismissed. 

"How  can  men  with  votes,  in  a  public  service  ruled  by 
votes,  be  kept  'in  their  place'  and  prevented  from  terror- 
ising their  superiors  by  political  bullying?"  Here  is  an- 
other of  the  hard  questions  private  ownership  puts  to  public 
ownership ;  but  the  Australasian  colonies  answer  it,  not  eas- 
ily, perhaps — nothing  is  easy  in  this  wicked  world — but 
with  workable  success. 

At  the  time  of  the  maritime  strike  of  1890  the  New  Zea- 
land railroads  were  under  "non-political  commissioners." 
The  railroad  men  joined  the  strike.  When  later  they  sought 
an  interview  with  the  commissioners,  these  refused  to  meet 
them,  to  the  great  delight  of  the  business  class  and  the  cor- 
responding displeasure  of  the  workmen.  The  Union  Steam- 
ship Company,  next  to  the  government  the  largest  concern 


SHARING  WITH  THE  MEN  47 

in  transportation,  pursued  the  same  policy.  "They  saved 
the  country,"  the  president  of  the  Industrial  Association  of 
Employers  said. 

This  action  of  the  commissioners  in  1890  was  one  of  the 
public  grievances  which  led  up  to  the  overthrow  of  the  com- 
missioner system  in  New  Zealand  in  the  election  of  1.893, 

The  railroad  employes  had  the  right  to  claim  the  benefit 
of  the  Compulsory  Arbitration  Law  in  its  original  form, 
but  they  have  since  lost  this  by  an  administrative  change 
which  was  not  meant,  however,  for  that  purpose.  The 
Appeal  Board  has  taken  the  place  of  the  Arbitration  Court. 

The  New  Zealand  government  recognises  the  trades- 
unions  of  its  railroad  men;  and  there  are  besides  these  or- 
ganisations— such  as  those  of  the  drivers  and  firemen— two 
others,  one  of  the  "officers"  and  another  of  the  "servants." 

But  the  railway  unions  have  not  much  power,  for  here,  as 
all  through  Australasia,  labour  organisations  are  weak. 
The  drivers,  or  engineers,  as  we  call  them,  work  nine  hours 
a  day.  The  mechanics  in  the  government  railroad  shops 
work  forty-eight  hours  per  week.  The  number  of  appren- 
tices is  fixed  to  one  in  every  four  men. 

The  railroad  men  cannot  strike.  They  may  take  their 
grievances  first  to  their  superior  officer,  then  to  the  Appeal 
Board,  and  then,  as  a  last  resort,  they  can  go  to  Parliament. 

In  his  report  for  1890  the  Minister  for  Railways  chron- 
icles the  "remarkable  expansion  of  our  railway  business," 
and  also  that  the  government  had  voluntarily  admitted  its 
men  to  share  in  its  prosperity  by  increasing  the  pay  of  all 
earning  6s.  6d.  ($1.62)  to  $1.75  a  day. 

The  remuneration  of  the  engine  drivers,  firemen  and 
some  other  classes  had  been  also  increased  by  an  act  of  the 
legislature.  This  was  a  policy  the  opposite  of  that  of  the 
commissioners,  who,  when  they  needed  to  economise,  reduced 
the  wages  of  the  men,  but  not  the  salaries  of  the  officers. 


48  THE  RAILWAY  KINGS 

It  may  be  cause  and  effect  that  the  minister  was  able  to  con- 
gratulate the  public  on  the  extreme  care  shown  by  the  staff 
in  working  the  railroad.  "Nothing  but  a  deep  interest  in 
the  work  can  account  for  the  results  achieved,"  he  says. 

The  South  Australian  commissioner,  like  the  New  Zea- 
land minister,  recognises  the  trades-unions  of  his  men.  "We 
could  not  get  around  it/'  he  said. 

Naturally  the  heads  of  the  railway  service  do  not  look 
with  favour  on  the  participation  of  their  men  in  politics.  In 
South  Australia  any  railway  employe  who  accepts  a  nomina- 
tion must  resign  his  place  in  the  service.  If  he  is  defeated 
he  does  not  get  back.  Formerly  employes  were  not  allowed 
to  take  any  part  in  politics  except  to  cast  their  vote,  but  that 
has  been  modified  so  as  to  permit  them  to  do  everything 
except  to  run  for  office  while  employes. 

I  was  in  the  office  of  the  Queensland  commissioner  when 
he  was  engaged  in  receiving  a  delegation  of  drivers,  and  his 
policy  he  said  is  "to  meet  the  trades-union  conditions  as  well 
as  I  can." 

The  fate  of  a  movement  of  the  tram  men  in  Sydney — the 
national  government  owns  all  the  street-car  lines  in  New 
South  Wales — just  before  I  was  there  did  not  seem  to  in- 
dicate much  consideration  for  the  trades-union.  The  man- 
agement had  been  presented  with  a  round-robin  signed  by 
one  hundred  and  sixty  men  complaining  of  liberties  cur- 
tailed, pay  reduced,  grievances  unredressed,  and  the  like. 
The  railroad  chiefs,  as  they  told  me  themselves,  divided 
up  among  eight  of  their  number  the  task  of  seeing  these  one 
hundred  and  sixty  men  individually,  and  they  did  not  find 
one  man  who  could — or  at  least  would — specify  a  case  to 
cover  the  statement.  Five  or  six  of  the  leaders  were  there- 
upon discharged  and  the  thing  ended.  The  men  under  the 
same  leadership  had  refused  to  go  into  a  provident  fund 
proposed  by  the  railroad  commissioners.  Afterward,  to  the 


HOLIDAYS  AND  PENSIONS  49 

number  of  five  thousand,  they  petitioned  to  have  the  scheme 
reopened,  but  the  commissioners  refused. 

The  tram-car  men  in  Sydney  work  fifty-five  hours  a  week 
and  their  union  is  not  recognised. 

The  railroad  commissioners  have  spent  eight  thousand 
dollars  on  a  club  building  and  library  for  the  men.  The 
men  in  all  parts  of  the  colony  pay  5^.  ($1.25)  a  year  toward 
its  maintenance. 

The  men  are  given  a  week's  holiday  for  good  conduct. 
The  holidays  they  work,  about  a  dozen  -in  a  year,  are  also 
credited  to  them.  When  they  wish  to  go  off,  they  have 
these  days  and  a  good  conduct  holiday  allowance  to  their 
credit,  and  in  this  way  can  take  two  or  three  weeks  with 
pay. 

Every  man  who  has  been  for  a  number  of  years  in  the 
employ  of  the  New  South  Wales  railroads  and  leaves 
through  sickness,  disability  or  old  age,  gets  a  grant  besides 
his  pay,  which  sometimes  amounts  to  fifty  pounds. 

There  is  a  pension  in  Victoria  for  the  railroad  men  and  an 
Appeal  Board  for  men  with  grievances. 

None  of  the  Australasian  governments  make  both  ends 
meet  in  their  railroads.  None  of  them  are  able  to  pay  out 
of  the  receipts  of  the  railroads  the  full  interest  on  the  money 
borrowed  to  build  them.  The  taxpayers  have  to  go  down 
into  their  pockets  every  year  to  make  the  deficit  good. 

In  New  Zealand,  in  1898,  the  roads  earned  three  per  cent, 
over  everything  but  the  interest  charge ;  and  if  the  railroad 
bonds  were  bearing  only  three  per  cent,  interest,  as  would  be 
the  case  were  they  refunded,  the  receipts  would  show  a  profit 
over  interest,  too,  of  .029.  But  the  fact  that  some  of  the 
bonds  carry  four  per  cent,  and  more,  prevents  this  showing 
of  profit.  The  report  of  1900  shows  the  earnings  of  1899 
to  have  increased  to  3.8  per  cent. 

The  amount  earned  on  the  capital  cost  of  the  railways 


50  THE  RAILWAY  KINGS 

for  the  other  colonies  for  1898,  was:  in  Victoria,  2.49  per 
cent;  Queensland,  2.93;  South  Australia,  2.69;  Tasmania, 
1.07;  New  South  Wales,  3.75;  Western  Australia,  4.62. 
As  in  New  Zealand,  this  is  not  quite  enough  to  meet  the 
interest  on  the  railway  debt. 

For  the  whole  of  Australasia,  the  railroads  yielded  3,27 
per  cent,  in  1898  on  the  cost  of  construction  as  represented 
by  the  bonded  debt.  It  must  be  remembered  that  the  roads 
are  not  run  in  the  dividend  spirit;  not  even  under  the  sys- 
tem of  commissioners.  The  commissioners  run  the  roads 
on  no  more  sordid  a  basis  than  to  make  ends  meet.  The 
head  of  the  New  South  Wales  department  said  to  me,  "We 
do  not  run  the  roads  to  make  money,  but  for  the  convenience 
of  the  public  and  the  good  of  the  men." 

The  financial  results  just  given  are  not  discouraging, 
they  are  distinctly  encouraging  in  view  of  the  unfavourable 
conditions  under  which  railroads  are  built  and  run  in  Aus- 
tralasia. The  population  is  sparse,  the  distances  long,  and 
there  is  a  lack  of  diversity  in  industry.  That  under  such 
difficulties  the  service  should  be  able  to  pay  within  a  small 
fraction  of  one  per  cent,  of  all  the  expenses,  including  in- 
terest, proves  that  the  people  as  owner  and  manager  of  rail- 
roads, has  business  ability  of  a  high  order. 

The  average  New  Zealand  haul  is  thirty-five  miles.  In 
America  the  average  is  nearly  five  times  this.  At  every 
important  point  in  New  Zealand,  also,  there  is  water  com- 
petition. The  government  has  not  yet  nationalised  the 
steamship  companies,  but  there  is  a  strong  movement  in  this 
direction  favoured  by  prominent  members  of  the  present 
Ministry. 

The  statistics  on  which  the  claims  of  low  rates  and  great 
reductions,  year  by  year,  on  the  American  roads  are  made, 
are,  as  all  students  of  the  matter  know,  very  misleading. 

The  average  rate  is  low  because  large  quantities  of  low- 


COMPARISON   UNFAIR  51 

class  freight,  like  soft  coal,  have  of  late  years  appeared  in 
the  statistics.  But  the  local  rates  in  America  remain  very 
high  and  have  often  been  increased  instead  of  lowered. 
With  all  the  disadvantages  enumerated  above,  the  Austra- 
lian roads,  as  some  of  the  rates  given  above  prove,  do  bet- 
ter for  their  public  than  the  private  roads  of  many  other 
countries. 

The  New  South  Wales  commissioners  claim  that  their 
coal  rate  is  lower  than  that  of  the  United  States,  considering 
that  their  average  haul  is  only  seventeen  miles  and  that  for 
their  charge  of  .o6d.  (1.2  cents)  a  mile,  a  little  over  a  cent 
a  ton  a  mile,  they  deliver  the  coal  on  board  the  steamer  at 
Newcastle.  The  coal  rate  in  Queensland  on  the  average  is 
.075^.  (il/2  cents)  a  ton  per  mile,  and  this  includes  delivery 
on  board  the  vessels.  New  Zealand  freight  rates  are  of 
course  high  in  comparison  with  ours.  The  country  is  diffi- 
cult and  young,  the  population  scattered,  and  the  railway 
system  is  not  a  connected  whole,  but  is  composed  of  a  num- 
ber of  little  railroads  reaching  out  from  the  principal  towns 
with  the  ends  not  yet  tied  together,  involving  a  very  high 
ratio  of  expenses  to  receipts. 

Comparisons  between  results  of  public  ownership  in  New 
Zealand  and  private  management  in  other  countries  are 
absurd  in  face  of  this  complete  lack  of  any  similarity  in  con- 
ditions. The  only  fair  question  is  how  do  the  roads  of  the 
state  in  New  Zealand  compare  with  their  private  roads? 
There  are  one  or  two  private  roads,  and  the  discoveries  of 
the  traveller  confirm  the  usual  verdict  of  the  New  Zealand- 
ers  that  the  roads  run  by  the  public  are  the  better  run  and 
the  private  lines  are  inferior  in  rolling  stock  and  other  con- 
ditions and  in  their  discipline. 

The  Wellington  and  Manawatu  road,  the  principal  private 
line  of  New  Zealand,  sometimes  has  sixty  sheep  cars  on  its 
best  train  ahead  of  the  passenger  cars.  It  runs  fewer  trains 


$2  THE   RAILWAY   KINGS 

and  gives  the  people  fewer  stations  than  the  roads  they  op- 
erate. It  takes  four  and  one  half  hours  to  do  eighty  miles. 
It  gives  three  suburban  trains  a  day  where  the  national 
line  gives  twelve.  It  does  not  charge  higher  freights,  as  it 
is  bound  by  its  charter  not  to  do  so. 

New  Zealand  has  a  right  to  buy  this  line  and  the  option 
will  probably  be  exercised  this  year,  as,  if  delayed,  the  owners 
have  a  right  to  exact  a  much  heavier  price.  The  stockhold- 
ers see  that  the  absorption  of  their  road  is  inevitable,  and 
they  are  anxious  to  have  it  come,  for  they  already  know 
what  competition  with  the  community  is  and  realise  that 
it  could  make  their  property  of  very  little  value. 

The  spirit  of  competition  is  strong  upon  a  government  in 
business  as  upon  the  individual  in  business.  To  Palmerston 
North,  one  hundred  and  forty  miles  from  Wellington,  by  the 
state  railway,  the  rates  are  made  the  same  as  those  of  the 
private  Wellington  and  Manawatu  road,  whose  route  is  only 
ninety  miles  long.  But  the  people  at  the  intermediate 
points,  who  have  no  access  to  a  competitive  carrier,  are 
still  charged  the  full  local  rates.  I  found  the  citizens  of 
Oamaru  full  of  bitter  complaints  against  the  railway  man- 
agement of  the  state.  The  city  had  gone  heavily  into  debt 
to  make  a  harbour  and  get  the  advantage  of  the  water  com- 
munication which  reaches  every  place  of  importance  in  the 
whole  colony.  The  moment  the  harbour  was  finished  the 
department  put  down  its  railroad  rates  and  the  breakwater 
and  the  wharf  stand  idle,  almost  a  dead  loss. 

Towns  with  water  facilities  get  freights  and  fares  at  com- 
petitive rates.  Those  dependent  upon  the  railroad  alone 
receive  no  such  concessions. 

Oamaru's  investment  has  borne  fruit  in  the  reduction  of 
railroad  charges,  but  from  the  point  of  view  of  the  con- 
servation of  social  energy  it  has  been  a  loss  to  get  this  by 
wasting  so  much  human  force  in  useless  construction. 


A   LAND-GRANT   FORFEITED  53 

Another  private  line  that  promised  to  be  important,  the 
Midland,  which  was  given  a  very  valuable  land-grant  of 
six  millions  of  acres,  has  become  government  property. 

The  colony  had  reserved  the  right  to  cancel  the  char- 
ter and  take  back  the  land  in  case  of  failure  to  comply 
with  the  conditions  of  the  grant.  In  retaining  this  right  it 
followed  the  example  of  the  United  States  in  its  charters  to 
the  transcontinental  and  other  land-grant  roads.  But  here 
the  imitation  ceased.  For  when  the  Midland  failed  to  com- 
plete its  line  as  agreed,  the  New  Zealand  government,  after 
showing  all  the  consideration  consistent  with  its  duty  to  the 
public,  forfeited  the  charter,  resumed  the  land-grant,  took 
possession  of  the  road,  and  is  now  completing  it  with  its 
own  engineers  and  by  the  co-operative  contract  system,  and 
is  operating  the  finished  portions  as  a  state  highway. 

This  forfeiture  places  a  magnificent  estate  in  the  hands 
of  the  Land  Department  for  closer  settlement. 

There  is  a  law  in  New  Zealand  under  which  private  lines 
can  be  built,  but  it  confers  no  power  to  take  land  for  the 
right  of  way.  This  must  be  bought  or  given.  The  plans  of 
any  proposed  railroad  must  also  receive  the  approval  of  the 
government.  There  are  laws  for  private  lines  in  New  South 
Wales  also,  and  the  colony  has  the  right  to  resume  posses- 
sion of  any  such  lines  at  a  price  to  be  agreed  upon  or  fixed 
by  arbitration. 

There  are  no  private  lines  in  New  South  Wales  for  com- 
parison of  capitalistic  with  democratic  operation.  All  the 
private  lines  are  unimportant  except  that  to  the  Broken 
Hill  mines.  This  charges  much  more  than  the  national 
lines,  but  all  the  conditions  of  the  traffic  are  exceptional. 

Some  private  lines  have  been  chartered  in  Queensland  in 
districts  where  the  colony  itself  did  not  care  to  build.  These 
enterprises  are  allowed,  on  account  of  the  special  circum- 
stances, to  charge  half  as  much  again  as  the  public  road. 


54  THE   RAILWAY    KINGS 

None  of  them  are  yet  in  operation  and  no  comparison  with 
the  roads  run  by  the  people  is  possible.  The  Queenslanders, 
also,  have  reserved  the  right  to  buy  up  all  these  private  lines 
if  they  desire  to  do  so  at  an  advance  of  ten  per  cent,  on  the 
cost  of  construction. 

When  English  capitalists  made  Queensland  an  offer  if 
given  a  land  grant  to  build  some  very  important  links  which 
would  make  a  connected  whole  of  what  are  now  disjointed 
lines,  the  government  approved  the  proposal ;  but  the  people 
to  whom  it  was  submitted  by  referendum  voted  it  down. 
What  they  had  learned  of  the  results  of  land-grant  rail- 
road building  in  other  countries  was  a  warning  they  thought 
it  well  to  heed. 

Ownership  by  the  people  of  the  railroads  in  Australasia 
was  a  second  thought.  The  first  railroads  were  private 
enterprises ;  and  under  the  direction  of  Gladstone,  then  Sec- 
retary of  State  for  the  Colonies,  Australasia  began,  in  New 
South  Wales,  the  development  of  its  system  on  English 
lines.  But  all  the  ventures  failed  miserably,  and  the  col- 
onies took  advantage  of  the  right  they  had  reserved  and 
took  possession  of  them. 

The  inability  of  the  private  roads  to  get  land  grants  on 
the  American  plan  was  one  of  the  causes  of  their  failure 
and  of  the  state  ownership  that  followed  it.  The  English 
ministry  then  in  charge  of  the  colony  refused  to  make  any 
further  concessions  than  that  the  roads  might  have  public 
lands  at  the  minimum  price  without  having  to  buy  them  at 
auction.  Besides  this  it  would  give  them  nothing.  Had 
the  question  of  favouring  the  railroads  been  at  the  discre- 
tion of  a  Parliament  near  the  fountain  of  pressure,  as  Wash- 
ington was  near  the  corporations  which  wanted  land  grants, 
it  is  not  likely  that  the  pressure  would  have  been  any  more 
successfully  resisted  in  Australasia  than  it  was  with  us. 

But  even  with  land  grants  it  is  not  probable  that  private 


TELEPHONES  AND  TELEGRAPHS     55 

roads  would  have  been  successful.  Their  promoters,  for  one 
thing,  would  have  found  great  difficulty  in  getting  money. 
London  capitalists  are  too  sharp  to  look  with  much  favour 
on  the  chances  of  profit  in  railroads  built  in  a  region  so  un- 
developed, so  erratic  in  climate  and  peopled  so  thinly.  But 
railroad  bonds  issued  by  the  state  and  backed  up  by  the 
credit  and  resources  of  the  people  were  another  matter. 

Private  railroads  practicable  in  America  were  impossible 
in  Australia  because  there  was  not  population  enough  nor 
business  enough.  Australia  was  too  new.  The  govern- 
ment was  the  only  agency  that  could  overlay  such  a  conti- 
nent with  a  network  of  expensive  thoroughfares. 

The  general  intention  when  the  railroads  fell  into  the 
hands  of  the  state  was  to  lease  them  back  as  soon  as  possible 
to  private  companies;  but  the  advantages  and  superiority 
of  administration  by  it  have  led  to  the  survival  of  the  state 
as  the  fittest  in  the  business  of  transportation,  and  the  high- 
ways of  Australasia  have  never  become  private  property  and 
it  is  safe  to  say  never  will. 

With  the  ownership  of  the  highways  came  as  a  matter 
of  course  state  telegraphs  and  telephones  as  a  part  of  the 
postal  system.  And  with  the  post-office  came  the  postal 
savings  banks,  and  the  many  functions  the  post-office  in 
Australasia  performs  for  the  public,  as  in  New  Zealand,  in 
bringing  old-age  pensioners  their  money  and  in  carrying 
the  savings  of  the  co-operative  workmen  on  the  public  works 
to  their  families. 

Like  the  railroads  the  telephone  was  at  first  a  private 
venture  in  some  of  the  colonies.  Victoria,  for  instance, 
gave  charters  to  capitalistic  companies.  This  it  did  to  its 
cost,  as  it  had  afterward  to  pay  handsomely  for  its  own  gift 
when  it  took  it  back,  and  besides  had  to  rebuild  the  lines 
poorly  equipped  by  private  enterprise.  "The  people  de- 
mand the  best  of  the  government."  South  Australia,  more 


56 

prudently,  refused  the  franchises  asked  for,  and  took  up 
telephoning  as  a  public  business  belonging  to  the  post-office. 
The  telegraph  line  that  connects  Australia  with  the  rest  of 
the  world  at  Port  Darwin  traverses  two  thousand  miles  of 
South  Australian  desert  from  south  to  north,  and  at  the 
stations  in  this  desert  the  department  raises  its  own  sheep, 
cows  and  horses. 

All  that  I  heard  confirmed  the  statement  of  one  of  the 
principal  officials  of  the  Wellington  and  Manawatu  road, 
that  the  public  opinion  of  New  Zealand  would  not  even  con- 
sider such  a  proposal  as  the  sale  of  the  government  roads  to 
private  capitalists.  Several  such  suggestions  had  been  made 
under  the  pretence  of  reducing  the  debt,  but  the  people 
would  not  listen  to  them. 

The  people  of  New  Zealand  and  Australia  understand  per- 
fectly well  their  unique  advantage  in  being  the  only  countries 
in  the  world  whose  public  debts  stand  for  public  works  in- 
stead of  public  wars,  and  represent  construction  instead  of 
destruction.  The  debts  of  Australasia  have  behind  them, 
even  allowing  for  the  Maori  war  debt  of  New  Zealand,  a 
dollar  of  property  for  every  dollar  of  debt.  Increase  of  debt 
with  them  has  been  increase  of  assets. 

These  people  understand,  too,  what  it  means  to  have  the 
public  highways  operated  by  public  policy  instead  of  for 
private  profit ;  and  they  know  what  it  means  to  be  free  from 
the  railroad  millionaires,  the  highwaymen  who  levy  toll 
under  private  ownership  on  every  man's  property,  and  pos- 
sess in  the  rebate-making  power  a  more  than  royal  prerog- 
ative to  create  favourites  of  fortune. 

The  whole  social  and  industrial  fabric  of  Australia  and 
New  Zealand,  its  land,  labour,  agriculture  and  commerce, 
and  consequently  its  financial  adjustments  at  home  and 
abroad,  rests  on  the  public  ownership  of  the  highways,  and 
would  be  revolutionised  by  private  exploitation  for  profit  of 


NOT    MADE   FOR    SALE  57 

the  means  of  communication.  Such  a  system  would  be  un- 
thinkable to  the  Australasian. 

The  only  man  in  Australasia  whom  I  found  in  favour  of 
private  ownership  was  in  New  Zealand,  and  he  was  an 
Irishman  who  had  lived  in  America.  He  told  me  how  at 
the  primary  election  in  Brooklyn  his  clique  had  beaten  off 
the  other  faction  of  their  party  from  the  polls  and  prevented 
them  from  exercising  their  right  to  vote.  "We  had  the 
captain  of  police,"  he  said,  "on  our  side.  He  stood  by  and 
never  said  a  word." 

In  the  New  Zealand  workshops  I  saw  government  car- 
penters and  machinists  and  other  workmen  building  loco- 
motives, dining-cars  and  ordinary  freight  and  passenger 
coaches,  and  doing  every  variety  of  repairing.  One  of  the 
chiefs  of  this  department  assured  me  the  New  Zealand  loco- 
motives were  equal  to  anything  in  the  world,  even  better 
than  those  of  the  United  States. 

"You  make  better  locomotives  than  ours?"  I  queried. 
"Yes,  sir,  we  do,"  he  replied,  "for  one  reason,  because  we  do 
not  make  them  for  sale." 

When  I  was  there  the  department  had  just  bought  twelve 
thirty-eight  ton  American  locomotives  for  £1650,  delivered 
at  Wellington,  and  ten  sixty-ton  engines  for  £2000;  the 
same  locomotives  bought  in  England  cost  £3150,  and  built 
in  New  Zealand  just  twice  as  much  as  the  American  article, 
£4000.  But  these  home-built  engines,  the  officials  insisted, 
lasted  longer  and  needed  fewer  repairs. 

The  department  does  not  attempt  to  make  all  its  own  en- 
gines, as  it  has  not  the  facilities  in  either  machinery  or  in 
skilled  men  that  would  be  necessary.  It  is  against  its  policy 
to  import  for  the  purpose  mechanics  for  whom  it  would  not 
be  able  to  provide  uninterrupted  work.  The  New  Zealand 
policy  with  regard  to  immigration  to-day  is  a  very  discrim- 
inating one.  "Our  work  here  is  too  intermittent  for  us  to 


58  THE   RAILWAY    KINGS 

import  mechanics  to  build  locomotives.  We  would  get 
a  lot  of  men  into  the  country  whom  we  could  not  keep 
steadily  employed  and  that  would  be  bad  for  them  and 
for  us." 

South  Australia  is  now  making  some  locomotives  for  it- 
self. I  found  its  workshops  at  Glanville  doing  quite  an 
extensive  business  in  the  manufacturing  of  iron  pipes  and 
other  findings.  This  enterprise  has  been  in  operation  since 
December,  1894. 

The  cost  of  the  work  done  shows  a  very  considerable 
reduction  on  the  prices  which  were  formerly  paid  to  the 
contractors.  A  table  given  me  by  the  Commissioner  of 
Public  Works  shows  that  where  the  contract  price,  for  in- 
stance, had  been  £10  2s*  40?.  ($50)  a  ton,  the  shop  price 
was  £8  ($40) ;  and  where  the  contract  price  was  £9,  the 
shop  price  was  £5  i6s.  ^d. 

Besides  the  manufacture  of  cast  iron  pipes,  a  great  variety 
of  work  is  being  done  in  these  shops  for  almost  all  the  de- 
partments of  the  government  service :  railways,  water-works, 
marine,  post  and  telegraph,  mining  and  stores  generally. 
The  convenience  of  having  a  general  workshop,  rough  and 
ready  as  it  is,  has  led  to  a  saving  of  time  and  expense  in  the 
preparation  of  advertisements,  drawings  and  specifications, 
and  in  the  prompt  execution  of  the  various  jobs.  Victoria, 
New  South  Wales  and  Queensland  have  workshops  but  do 
only  repair  work. 

When  Sir  Julius  Vogel  brought  in  his  bill  to  borrow  ten 
million  pounds  in  1870  for  the  construction  of  railroads 
and  other  public  works,  there  were  only  forty-seven  miles 
of  railroad  in  New  Zealand  and  the  population  was  only 
280,000. 

He  had  a  comprehensive  plan  for  the  colony  as  a  whole, 
but  it  went  to  pieces  in  face  of  local  jealousies.  To  this 
day  Auckland  and  Wellington,  the  two  principal  towns  of 


59 

the  North  Island,  are  not  connected,  and  the  railroads  of  the 
South  Island  joining  its  principal  towns,  Invercargill,  Dun- 
edin  and  Christchurch,  have  not  yet  been  brought  up  to  Cook 
Strait,  across  which  lies  Wellington,  the  political  capital  and 
the  most  important  city  in  New  Zealand.  When  it  is  urged 
that  private  ownership  as  shown  in  England  and  America 
has  a  better  initiative  than  this,  the  New  Zealander  replies 
that  all  he  would  have  gained  by  the  private  construction,  of 
the  highways  he  would  have  lost  afterward  at  the  hands 
of  the  uncontrollable  wealth  and  power  he  would  have 
created.  New  Zealand  sees  how  helpless  the  British  and 
American  public  is  in  the  hands  of  the  owners  of  the  high- 
ways and  does  not  think  the  mechanical  superiorities  of 
capitalism  worth  as  much  as  freedom. 

The  New  Zealander  thinks  the  inconveniences  he  suf- 
fers are  part  of  the  education  of  the  democracy,  teaching 
it  to  consider  the  common  good  instead  of  individual  and 
local  self-interest,  and  he  thinks  this  lesson  worth  all  it  has 
cost  and  is  still  to  cost. 


CHAPTER    IV 
NO  "PUBLIC  BE  DAMNED" 

ONE  thing  incontestably  results  from  the  public  ownership 
of  New  Zealand,  and  a  very  great  thing  it  is — that  the 
administration  of  public  highways  is  the  public's  business. 
There  is  no  Vanderbilt  to  say,  "The  public  be  damned" ; 
there  the  people  are  the  railway  kings. 

Every  detail  of  policy  regarding  the  extension,  operation, 
and  manning  of  the  highways  is  public  business,  universally 
acknowledged  to  be  such  by  the  people,  press,  Parliament 
and  ministry  and  business  interests. 

The  New  Zealand  railways  are  in  some  respects  almost 
primitive.  They  can  be  shown  to  be  inferior  to  the  roads 
of  Europe  and  America  in  speed  and  comfort,  though  there 
are  no  such  cheap  excursions  on  the  American  roads  as 
those  given  the  schools  and  factories  of  New  Zealand,  and 
there  is  not  on  our  "Sunset"  or  "Cannon-ball"  limited  trains 
any  car  equal  to  the  "Bird-cage"  car  on  the  New  Zealand 
express  trains,  composed  of  compartments  with  an  outside 
corridor  up  and  down  which  the  passengers  can  walk  under 
shelter,  but  with  a  full  view  of  the  scenery.  This  corridor 
is  inclosed  with  a  wire  grating  breast  high,  and  hence  the 
name  "bird-cage." 

The  "scientific"  traveller  could  fill  a  volume  with  the 
complaints  which  he  could  gather  from  the  remonstrances 
of  railway  reform  leagues,  deputations  to  the  Premier  and 
Minister  for  Railways,  from  the  debates  in  Parliament,  and 

60 


FREIGHTS   LOWERED   FOR   FARMERS      61 

from  individuals  with  private  grievances.  There  is  imper- 
fection in  everything  human — even  in  private  highways. 

But  whatever  else  they  may  have  failed  in,  the  democracy 
of  New  Zealand  and  Australia  have  not  failed  to  make 
the  management  of  their  own  highways  their  own  affair. 
Railway  policy  on  all  its  sides — as  to  freights,  fares,  new 
lines,  questions  between  the  employes  and  management — is 
continually  before  Parliament  and  the  public.  The  Pre- 
mier as  he  goes  about  a  colony  receives  deputations  here 
and  there  urging  the  alteration  of  this  route,  the  construc- 
tion of  that  new  line,  the  reduction  of  these  rates.  Public 
meetings  are  held,  representatives  are  instructed  how  to 
vote,  resolutions  are  passed  pledging  the  people  to  make 
this  railway  construction  and  that  railway  reform  their 
"battle  cry"  and  to  refuse  to  vote  for  any  candidate  that 
will  not  support  them.  A  deputation  of  the  mayors  of  all 
the  principal  towns,  of  members  of  the  largest  chambers 
of  commerce  in  the  colony  and  of  representatives  in  Par- 
liament waits  on  the  New  Zealand  Premier  to  press  the 
claims  of  a  route  for  the  main  trunk  line  in  the  North 
Island.  The  Premier  promises  that  a  full  inquiry  will  be 
made,  and  that  Parliament  will  be  put  in  possession  of  all 
the  facts  needed  for  a  proper  decision. 

When  a  new  railroad  is  opened  it  is  a  festival  not  of 
speculators,  but  of  the  people.  The  first  sod  of  the  Gis- 
borne-Karaka  railroad  was  turned  last  February  by  the  Min- 
ister for  Railways,  and  other  ministers  were  present.  The 
Premier  sent  a  telegram  giving  his  pledge  that  the  con- 
struction of  the  road  should  not  be  allowed  to  lag. 

The  wheat  crop  of  1899  was  very  large,  especially  in  Can- 
terbury, where  it  averaged  twenty-five  bushels  to  the  acre, 
and  the  prices  were  very  low.  Forty-five  hundred  organ- 
ised farmers  of  Canterbury  sent  a  committee  of  three  to 
wait  on  the  minister,  asking  for  a  reduction  in  grain  rates, 


62  NO   "PUBLIC   BE   DAMNED" 

These  had  remained  stationary,  while  on  other  things  the 
railway  tariff  had  been  lowered.  The  minister  responded 
with  the  assurance  that  he  had  already  considered  the  mat- 
ter and  intended  to  propose  to  the  Cabinet  that  the  rates 
on  grain  should  be  lowered  and  other  concessions  made  to 
the  farmers. 

The  Premier  took  the  thing  up  and  announced  the  next 
day  in  a  speech  in  the  political  campaign  he  was  making  that 
reductions  would  be  made  amounting  to  an  increase  of 
nearly  $1.75  an  acre  in  the  income  of  a  farmer  who  raised 
thirty-five  bushels  of  wheat  to  the  acre.  The  Premier  also 
said  that  the  total  of  the  reductions  which  had  been  made 
to  the  people  by  his  administration  in  the  freight  and  pas- 
senger tariffs  had  relieved  them  to  the  extent  of  more  than 
$1,250,000  a  year.  This  is  just  about  the  amount  of  the 
land  tax.  So  that  the  same  policy  took  off  this  sum  from 
the  people's  transportation  and  put  it  on  the  large  owners  of 
land. 

In  meeting  this  delegation  the  Minister  for  Railways 
made  a  statement  which  will  interest  those  readers  who 
know  of  no  other  relations  between  the  highwaymen  and  the 
public  than  those  which  they  see — or  do  not  see — where  the 
railroads  are  private  property. 

"It  is  my  custom,"  Minister  Cadman  said,  "at  the  end  of 
each  financial  year  to  draw  up  a  list  of  reductions  which 
I  think  could  reasonably  be  made  for  the  next  financial  year 
for  the  consideration  of  the  Cabinet."  The  present  finan- 
cial year  was  drawing  to  a  close,  and  he  had  drafted  a  list 
of  products,  including  grain,  manures  of  all  kinds,  cheese 
and  butter,  on  which  he  would  suggest  to  his  colleagues 
that  rates  should  be  lowered. 

He  recalled  the  fact  that  he  had  stated  three  years  ago, 
when  he  took  over  the  railways,  that  as  money  was  only 
earning  three  per  cent,  it  was  not  requisite  that  the  rail- 


TILT   WITH   THE   MINISTER  63 

ways  should  earn  more,  and  any  excess  of  earnings  would 
be  given  to  the  producers.  "This  policy  the  government 
adheres  to,  for  its  producers  are  farther  from  the  world's 
markets  than  those  of  any  other  country,  and  are  entitled 
to  every  assistance." 

A  formidable  organisation  in  Canterbury,  New  Zealand, 
the  Canterbury  Railway  Reform  League,  bombarded  the 
Minister  for  Railways  with  a  carefully  planned  agitation 
for  lowering  rates  for  the  city  of  Christchurch  and  its  port, 
Lyttleton.  They  said  "for  many  years  past  there  has  been 
a  widespread  feeling  of  dissatisfaction  in  this  district  with 
the  policy  adopted  in  the  management  of  the  railways.  The 
objectionable  features  of  the  management  have  varied  but 
little  with  the  successive  administrations  of  the  last  twenty 
years.  The  main  principle  that  has  been  apparent  through- 
out has  been  a  determination  to  extract  the  largest  possible 
amount  of  money  from  the  pockets  of  the  Canterbury  tax- 
payers. Equitable  rates  and  anything  like  a  scientific  and 
intelligent  commercial  policy  have  manifestly  been  subordi- 
nated to  the  exigencies  of  the  treasury.  There  has  been 
an  unreasoning  and  almost  uniform  insistence  upon  high  and 
vexatious  charges.  Instances  are  on  record  where  it  could 
be  shown  that  it  took  years  of  demonstration  to  convince  the 
official  heads  of  the  value  even  from  a  revenue  standpoint 
of  certain  suggested  alterations." 

The  league  also  charged  the  department  with  rates  which 
were  "obviously  most  arbitrary  and  unreasonable,"  and  that 
they  had  "ignored  the  responsibilities  which  legitimately 
belong  to  common  carriers."  But  the  minister  met  all  this 
with  a  determined  defence  of  the  methods  of  the  department. 
He  declined  to  make  the  changes  requested.  He  pointed 
out  that  these  would  benefit  mainly  "a  few  wealthy  traders" 
in  the  city  of  Canterbury,  while  the  "country  settlers"  would 
get  little  or  no  advantage. 


64  NO   "PUBLIC   BE   DAMNED" 

Whether  the  league  or  the  minister  was  most  in  the  right 
is  not  the  important  point  for  us.  That  point  here  and  in 
the  other  incidents  we  are  noting  is  the  right  and  oppor- 
tunity to  be  heard  and  felt  which  the  democratic  operation 
of  highways  gives  the  public. 

None  of  the  travelling  accommodations  of  New  Zealand 
are  what  could  be  described  by  the  American  as  luxurious, 
and  those  that  have  been  provided  for  the  second  class  are 
primitive  in  the  extreme.  Narrow,  uncushioned  seats,  bare 
floors,  draughty  doors  and  windows  make  the  cars  cheerless 
and  uncomfortable,  though  in  New  Zealand  as  elsewhere 
the  majority  of  the  travellers  are  second  class.  But  the 
New  Zealander  has  a  better  remedy  for  all  this  than  sheep- 
like  submission  or  mere  grumbling,  which  does  not  reach 
the  managers,  and  under  private  ownership  would  not  move 
them  if  it  did.  His  newspapers  advertise  the  grievance. 
Parliament  takes  it  up.  Resolutions  are  introduced  demand- 
ing the  reform  of  this  essentially  undemocratic  treatment 
of  the  majority.  Public  opinion  finds  the  way  to  make 
itself  felt  by  the  railway  officials,  and  serves  them  with  no- 
tice that  as  rapidly  as  possible  they  must  bring  the  accommo- 
dations of  the  second-class  cars  up  to  a  better  standard. 
Accordingly  we  find  in  the  annual  statement  of  the  Minister 
for  Railways  for  the  next  year  that  all  new  second-class 
carriages  are  to  be  provided  with  cushions  and  all  the  old 
ones  are  to  be  so  furnished  as  rapidly  as  they  come  back 
to  the  repair  shops. 

As  the  time  approaches  within  which  the  option  of  the 
government  to  purchase  the  Wellington  and  Manawatu  rail- 
road will  expire,  the  chambers  of  commerce  and  other 
public  bodies,  including  the  local  authorities  of  all  the  dis- 
tricts through  which  the  line  runs,  meet  in  conference  and 
urge  the  people  of  these  districts  to  make  the  acquisition 
of  the  line  a  plank  in  their  electoral  platform,  and  measures 


NEVER  RAISES   RATES  65 

are  taken  to  enlist  in  this  work  all  of  the  public  bodies, 
chambers  of  commerce,  and  all  the  newspapers  of  New 
Zealand. 

I  was  present  when  a  delegation  called  to  lay  before  the 
Minister  for  Public  Works  a  resolution  of  an  important 
conference  demanding  the  completion  of  the  North  Island 
Trunk  Railroad.  That  the  construction  of  this  railroad  and 
the  route  which  it  should  follow  and  the  time  within  which 
it  should  be  completed  were  public  business  and  that  the 
presentation  of  these  resolutions  and  the  request  for  this 
conference  were  the  legitimate  participation  by  the  people 
in  their  own  business  was  a  matter  of  course. 

The  tariffs  on  the  government  roads  are  continual  sub- 
jects of  public  discussion.  The  public  of  New  Zealand 
never  questions  that  it  is  the  real  rate-making  power.  It 
does  not  determine  the  details  of  the  rate  sheet,  but  it  does 
determine  the  principles  on  which  they  shall  be  made. 

Questions  of  administration  and  practical  operation  the 
New  Zealanders  delegate  to  heads  of  departments,  but  ques- 
tions of  general  policy  are  delegated  to  no  one.  These  are 
for  the  people. 

Neither  the  public  nor  Parliament  attempts  to  dictate  to 
the  management  of  the  roads  what  the  rates  of  fares  or 
freights  shall  be  in  this  or  that  case,  but  they  are  habitually 
and  continually  scrutinising  them,  and  they  think  it  is  their 
business  to  exercise  an  effective  and  audible  right  of  revision. 

During  the  last  campaign  no  topic  was  more  steadily  kept 
to  the  front  by  the  Premier  in  his  speeches  than  the  reduc- 
tions in  rates  that  had  been  made  and  were  to  be  made  dur- 
ing his  administration.  In  his  report  for  1899,  the  Minister 
for  Railways  announced  reductions  of  forty  per  cent,  in  the 
rates  of  farm  products  and  twenty  per  cent,  on  butter  and 
cheese.  He  showed  that  these  concessions  are  equal  to  one 
seventh  of  one  year's  revenue,  For  the  United  States  such 


66  NO  "PUBLIC  BE  DAMNED" 

a  lowering  of  the  railway  charges  would  have  relieved  the 
people  to  the  extent  of  $150,000,000  a  year. 

One  of  the  differences  between  private  and  public  owner- 
ship appears  to  be  that  the  latter  never  raises  rates, 
a  fact  which  the  farmers  of  the  Mississippi  Valley  and  the 
consumers  of  the  coal  of  Pennsylvania,  who  have  recently 
seen  the  rates  raised  against  them,  would  appreciate. 

"Rates,"  said  one  of  the  managers  of  the  New  Zealand 
roads,  "can  be  reduced.  But  it  is  an  axiom  of  public 
ownership  that  they  can  never  be  advanced.  The  govern- 
ment once  made  too  great  a  reduction  on  sheep.  It  lost  so 
much  revenue  that  it  had  to  restore  the  old  rates,  where- 
upon the  popular  indignation  overturned  the  ministry." 

In  the  first  speech  made  after  the  last  election  by  the 
Honourable  J.  G.  Ward,  who  has  been  given  the  post  of 
Minister  for  Railways  in  place  of  Mr.  Cadman,  who  retires 
on  account  of  his  health,  after  a  very  successful  and  popu- 
lar administration,  Mr.  Ward  announced  a  general  low- 
ering of  railroad  passenger  fares  as  the  first  fruits  of  his 
administration.  This  announcement  was  received  with 
cheers  by  the  large  audience — stockholders  of  the  roads. 

In  all  these  matters — the  routes  of  new  lines,  the  treat- 
ment of  the  men,  the  fixing  of  rates — these  incidents  show 
how  practically  and  really  ownership  by  the  government  is 
public  ownership,  and  how  public  ownership  is  for  as  well  as 
by  the  people.  The  people  know  that  they  have  something 
to  say  on  all  these  points,  and  they  say  it.  Their  policy  is 
only  a  compromise  between  the  different  desires  and  inter- 
ests in  different  sections,  each  pulling  its  own  way.  It  is, 
in  other  words,  only  human,  but  in  this  very  conflict  there 
is  an  educational  value.  There  are  mistakes,  but  even  the 
mistakes  are  more  profitable  than  a  policy  without  mistakes 
if  it  had  to  be  also  a  policy  without  democracy. 

There  are  no  air  brakes  even  on  the  express  trains  in  New 


BUT   67 

Zealand — but  there  are  no  railroad  wreckers  in  the  boards 
of  directors.  There  is  no  cord  between  the  passenger  cars 
and  the  conductor  and  engineer — but  there  is  also  no  pri- 
vate wire  between  the  president's  office  and  the  brokers  in 
the  stock  exchange  to  the  ruin  of  his  stockholders.  There 
were  no  dining-cars  when  I  was  there,  though  they  have 
since  been  put  on,  but  there  were  no  Credit  Mobilier  nor 
construction  rings  feeding  on  the  corporation.  The  rates 
are  high,  but  what  the  traveller  or  the  shipper  pays  the 
treasury  gets.  There  are  no  rebates  to  favoured  shippers, 
no  discriminations  in  charges  to  shunt  the  business  of  mer- 
chants or  manufacturers,  who  do  not  happen  to  be  the  pets 
of  the  traffic  manager,  into  the  hands  of  those  who  do  have 
that  lucky  preference. 

What  Premier  Seddon  and  the  Minister  for  Railways,  Mr. 
Cadman,  meant  when  they  said  that  the  railways  were  not 
run  for  profit  but  for  public  service  can  be  seen  on  every 
hand  in  the  administration  of  New  Zealand  highways.  In 
its  relation  to  labour,  production,  exports,  land  settlement, 
relief  of  distress  and  the  education  and  health  of  the  peo- 
ple in  city  and  country  the  commonwealth  makes  a  use  of  its 
railways  which  would  be  impossible  to  private  lines.  Act- 
ing for  the  whole,  it  can  make  a  profit  for  the  whole  even  in 
losing  money.  Public  ownership  can  therefore  be  a  great 
economic  success  even  when  it  makes  no  profit,  while  pri- 
vate ownership  is  often  a  success  only  by  creating  loss  for 
the  whole  to  make  a  profit  for  the  few — as  in  the  shut-down 
policy  of  the  Pennsylvania  coal  roads. 

The  railroads  are  used  in  New  Zealand  at  cost,  or  less,  to 
redistribute  the  unemployed  for  whom  the  Labour  Bureau 
has  found  places,  and  for  the  settlement  of  the  people  on  the 
land  as  described  elsewhere. 

The  key-note  of  the  policy  with  which  railroad  building 
was  inaugurated  by  Vogel  was  "public  works  and  immi- 


68  NO  "PUBLIC  BE  DAMNED" 

gration."  With  the  Liberals  came  in  the  new  policy  of 
"public  works  and  the  settlement  of  the  land"  now  a  control- 
ling feature  of  the  political  economy  of  New  Zealand.  New 
Zealand,  instead  of  sending  people  who  want  to  settle  on  the 
land  out  into  the  wilderness,  breaks  up  the  great  estates 
that  have  been  formed  along  the  lines  of  the  railroads  al- 
ready built  and  settles  the  people  there  and  increases  its 
revenues  from  these  roads,  as  well  as  from  the  new  taxable 
values  created. 

Private  builders  of  highways  quite  naturally  appropriate 
by  speculation  the  increase  of  value  which  plans  known 
only  to  themselves  will  give.  They  thus  interpose  the  bar- 
rier of  a  profit  for  themselves  in  the  way  of  the  settlement 
of  the  country. 

Public  ownership  in  New  Zealand,  equally  intelligent  in 
foreseeing  the  values  its  roads  will  make,  appropriates  this 
for  the  people  and  facilitates  settlement. 

Mr.  Seddon,  when  Minister  for  Public  Works,  pointed 
out  in  one  of  his  reports  that  the  continuance  of  a  certain 
railway  construction  then  in  hand  meant  that  "every  pound 
which  the  government  spends  upon  the  railway  will  give 
an  increased  value  of  twice  that  amount  to  the  land  through 
which  the  railway  runs,  which  will  be  a  benefit  to  a  very  few 
individuals."  He  announced  therefore  that  it  had  been  de- 
cided that  it  would  be  folly  to  go  on  until  arrangements 
had  been  made  with  these  owners,  some  of  them  natives, 
for  such  sale  or  lease  of  their  land  as  would  give  the  public 
the  advantage  of  this  "unearned  increment." 

In  the  chapter  entitled  "Government  and  Company,  Un- 
limited" we  will  see  how  popular  ownership  of  railroads 
stimulates  the  general  prosperity  by  special  rates  and  facili- 
ties to  producers  for  export.  In  times  of  calamity  the  peo- 
ple can  use  the  peoples'  railroads  for  something  better  than 
"getting  all  the  traffic  will  bear."  After  a  destructive  and 


WHERE   WE  LOOK  IN   VAIN  69 

very  unusual  snow  storm  in  Otago  a  few  years  ago,  in 
which  vast  numbers  of  sheep  were  lost,  the  railroad  rates 
for  stock  were  cut  down.  These  "starved-sheep  rates,"  as 
they  were  called,  permitted  the  farmers  to  restock  their  runs 
at  a  very  low  cost.  "We  expected,"  the  minister  said,  "to 
lose  heavily,  but  the  increased  traffic  more  than  made  up 
for  the  lower  charges." 

One  department  was  thus  made  to  come  to  the  rescue  of 
another.  Here  the  railways  saved  not  only  the  settlers  but 
the  land  department,  which  would  have  incurred  very  severe 
losses  in  the  rents  of  tenants  brought  to  the  verge  of 
ruin. 

All  such  changes  of  rates  must  be  published,  so  that  all 
localities  and  business  interests  may  know  what  is  being 
done  and  act  accordingly. 

But  it  is  in  its  methods  of  construction  that  public  owner- 
ship of  the  highways  stands  forth  in  its  most  attractive  as- 
pect. We  see  New  Zealand  building  its  roads  without  the 
sweating  contractor.  We  see  its  men  doing  the  work  co- 
operatively. Coming  from  the  towns  as  casuals  they  are 
deposited  on  the  land  in  permanent  settlements.  They  are 
changed  as  they  work  from  tramps  to  taxpayers.  The  right 
and  mercy  of  employment  are  given  old  men  as  well  as 
young,  delicate  men  as  well  as  robust.  We  know  that  we 
could  look  through  the  whole  world  of  private  highways 
for  only  one  instance  like  this,  and  look  in  vain. 

The  Minister  for  Railways  calculates  that  the  low  rates 
at  which  he  carries  the  school  and  factory  excursions — four 
miles  for  a  cent — makes  his  department  lose  heavily,  but 
he  is  in  a  position  where  he  can  see  and  serve  a  larger 
public  interest  than  making  money,  and  he  thinks  it  enough, 
as  he  states  in  his  report,  that  "from  an  educational  point 
of  view  very  marked  and  beneficial  results  must  follow." 
This  is  a  creation  of  real  wealth  in  the  fullest  sense  in 


70  NO   "PUBLIC   BE   DAMNED" 

which  Carlyle  and  Ruskin,  and,  in  fact,  all  the  true  econo- 
mists have  urged  it  upon  the  people. 

Much  has  been  made  by  the  critics  of  Australasian  public 
ownership  of  the  unsatisfactory  results  alleged  of  the  ad- 
ministration of  railroads  directly  as  a  department — what  is 
styled  the  "political"  system.  These  critics  dilate  on  the 
fact  that  all  the  colonies  were  led  in  the  years  1883  and 
following  to  substitute  the  system  of  administration  by 
''non-political"  commissioners.  But  these  changes  in  policy 
are,  at  least,  the  best  of  evidence  that  can  be  asked  that  the 
democracy  watch  the  management  of  the  highways  keenly 
and  shrewdly,  and  are  capable  of  a  complete  reversal  of 
policy  when  it  seems  necessary. 

The  fact  that  after  five  years  trial  of  management  by 
commissioners  the  people  of  New  Zealand  went  back  to  the 
former  "political"  method  proves  again  the  watchfulness 
and  intelligence  of  the  people  and  exhibits  the  democracy 
as  a  careful  master  of  its  own  business.  This  return  in 
policy  was  made  only  after  much  discussion  in  and  out  of 
Parliament,  and  only  after  a  political  campaign  had  been 
fought  out  on  that  issue  resulting  in  an  imperative  man- 
date from  the  people  to  their  representatives  to  make  the 
change. 

All  the  Australasian  colonies  except  New  Zealand  retain 
the  "commissioner  system,"  and  where  it  was  the  strongest 
I  heard  the  bitterest  complaints  against  the  interference  of 
politicians.  One  of  the  commissioners  whose  power  is  of 
the  greatest,  since  he  has  the  power  to  make  new  rates,  to 
arrange  methods  of  appointment  to  places,  and  must  be  con- 
sulted on  new  lines,  confessed  that  his  life  was  made  a 
burden  by  the  politicians.  "The  politicians  are  all  on  the 
job.  The  members  of  Parliament  are  simply  commission 
agents  for  their  constituents." 

The  people  of  New  Zealand  made  the  discontinuance  of 


RAILWAYS    IN    THE    ELECTION  71 

the  system  of  railway  management  by  commissioners  or  the 
"non-political"  system  an  issue  of  the.  election  of  1893. 
They  returned  to  Parliament  men  pledged  to  abolish  the 
commissioners  and  put  the  highways  again  under  the  direct 
administration  of  a  Minister  for  Railways  and  Parliament. 
The  popular  verdict  was  overwhelming. 

It  may  appear  to  the  American  reader  that  an  account 
of  this  struggle  in  New  Zealand  between  the  "commis- 
sioner" and  "ministerial"  methods  cannot  have  much  inter- 
est for  him,  since  he  is  a  citizen  of  a  country  which  does 
not  own  its  own  roads.  But  there  is  no  telling  how  soon 
this  may  become  a  practical  question  even  in  America. 

The  commissioner  system  was  almost  private  ownership, 
and  in  its  worst  possible  form,  since  the  commissioners  had 
the  powers  of  private  owners,  but  none  of  the  responsibili- 
ties of  owners  who  suffer  loss  for  their  mistakes.  It  was 
a  commercial  system.  It  made  money  for  the  treasury,  and 
to  that  extent  lightened  the  tax  of  the  rich  man.  Manage- 
ment directly  by  the  government,  not  for  profit  but  for  the 
best  public  service,  disregards  profits  and  does  not,  like 
the  other  policy,  relieve  the  large  taxpayer  by  paying  the 
expenses  of  the  state  out  of  the  earnings  of  the  railroads. 
These  earnings  come  out  of  the  travel  and  traffic  of  the 
multitude,  and  to  make  a  profit  from  them  for  the  benefit 
of  the  treasury  is  to  make  the  poor  man  pay  for  the  govern- 
ment of  which  the  rich  man  gets  the  greater  advantage. 

The  commissioner  system  seeks  to  reduce  taxes.  The 
other  seeks  to  lessen  the  expense  of  living  for  the  people. 
It  was  by  the  sure  intuitions  of  democracy  that  the  people 
in  New  Zealand  favoured  the  policy  of  direct  Parliamentary 
control.  By  this  policy,  as  population  and  business  increase, 
the  tariff  cheapens  and  the  public,  by  a  lowering  of  the  rates, 
is  given  the  benefit  of  its  own  growth. 

In  all  the  other  colonies  the  railroads,  being  under  com- 


72  NO   "PUBLIC   BE   DAMNED" 

missioners  who  are  railroad  men  pure  and  simple,  are  run 
just  as  railroad  men  would  do  it  in  other  unregenerate  parts 
of  the  world. 

The  "political"  management  of  the  New  Zealand  rail- 
roads can  carry  without  charge  lime  for  the  farmer  and  tim- 
ber for  boxes  for  produce  to  be  exported,  because  the  public 
good  will  gain  more  from  the  prosperity  resulting  than 
it  will  lose  in  lime  or  timber  freights.  But  the  technical 
management  by  the  commissioners  in  Victoria,  who  are 
railroad  men  first  and  last,  when  it  is  asked  to  carry  coal 
below  cost,  refuses  because  it  has  to  look  out  for  the  pros- 
perity of  the  railroads  and  leaves  the  prosperity  of  the  coun- 
try to  those  whose  special  business  that  is. 

One  great  value  of  the  political  method  is  that  it  gives 
a  voice  and  chance  to  new  ideas.  It  was  not  a  railroad 
man  who  invented  the  sleeping-car,  nor  were  Mr.  Vaile,  the 
inventor  of  the  zone  idea  in  New  Zealand,  nor  the  Minister 
in  Hungary,  who  introduced  an  imperfect  modification  of 
it,  railroad  men. 

The  ministerial  or  Parliamentary  system  brings  the  rail- 
road management  within  speaking  distance  of  all  the  people 
for  suggestions  either  as  to  abuses  or  improvements.  The 
other  is  a  "bureau"  system,  and  is  much  less  accessible  and 
responsive,  and  by  its  very  constitution  cannot  admit  into 
its  calculations  a  policy  of  reducing  rates  for  the  public  good. 
The  ministerial  system  serves  the  officials  of  the  roads  by 
giving  them  a  voice  in  Parliament  when  attacked,  and  it 
serves  the  public  by  giving  it  a  certainty  of  being  able  to 
attack  and  put  the  minister  on  the  defensive. 

The  commissioner,  or  "non-political"  system,  as  it  is 
called,  to  give  it  the  appearance  of  being  free  from  the 
political  abuses  of  patronage  and  the  like,  is  non-political 
only  in  name.  The  commissioners  under  it  know  well  they 
exist  only  at  the  pleasure  of  Parliament. 


THE   PROPERTY   POLICY  73 

Management  by  commissioners  was  inaugurated  by  the 
Conservatives — the  party  of  property — in  1887.  It  did  not 
please  the  people  of  New  Zealand.  The  commissioners  were 
able  to  show  in  their  annual  reports  a  profit  nearly  equal  to 
the  amount  of  interest  needed  for  the  railroad  debt,  but  it 
was  evident  that  it  was  only  apparent,  and  that  both  the 
roads  and  the  employes  were  being  starved  to  show  this 
profit  for  the  present  glory  of  the  commissioners.  The 
true  economy  of  the  railroad  system  was  being  sacrificed. 

Complaints  of  all  kinds  were  rife.  The  commissioners 
were  denounced  as  "monopolists,"  "irresponsible  despots," 
and  a  "failure."  They  assumed  the  right  to  make  con- 
tracts without  calling  for  tenders,  and  ordered  supplies 
abroad  which  could  be  furnished  by  New  Zealand  concerns. 
The  public  travelled  with  nervous  apprehension  over  bridges 
which  had  to  be  propped  up  and  where  the  screws  could  be 
seen  to  be  a  third  rusted  through.  Rates  were  reduced,  but 
by  reducing  wages.  The  labour  charge  was  lowered  by 
employing  boys  to  an  extent  unknown  before,  and  the  New 
Zealanders  do  not  like  the  spectacle  of  idle  men  and  busy 
children.  The  treatment  both  of  the  shippers  and  the  men 
was  most  arbitrary.  When  it  was  sought  to  economise  the 
men  were  cut  down,  in  the  capitalistic  spirit,  but  not  the 
high-priced  officials.  Because  of  the  high  rates  firewood 
went  to  waste  in  the  forests  and  potatoes  rotted  in  the  fields, 
while  the  cities  went  cold  and  hungry  during  the  years  of 
depression.  Some  of  the  heads  of  the  department  were  seen 
drinking  champagne  during  business  hours,  and  the  public 
dissatisfaction  was  great.  Produce  was  being  hauled 
cheaper  by  waggon  than  by  rail.  The  railway  employes 
were  in  .constant  agitation,  while  the  post-office  men  who 
were  under  the  direct  control  of  the  government  were 
tranquil.  In  the  strike  of  1890  the  commissioners  acted  in 
co-operation  with  the  great  steamship  monopoly  and  the 


74  NO   "PUBLIC   BE   DAMNED" 

associations  of  employers,  and  refused  to  grant  the  request 
of  the  railroad  men  for  an  interview  to  arrange  terms  of 
peace,  and  throughout  their  career  refused  to  recognise  the 
unions  of  the  men.  This  their  colleague,  Minister  Seddon, 
then  of  the  Public  Works  Department,  and  soon  to  be  Pre- 
mier, declared  to  "amount  to  an  interference  with  the  lib- 
erty of  the  subject.  So  long  as  the  railway  commissioners 
maintain  their  present  hostile  attitude  toward  unionism,  so 
long  will  their  employes  have  ground  for  complaint." 

The  New  Zealanders  are  very  jealous  democrats,  and  the 
fact  that  the  commissioners  were  not  under  the  people's 
immediate  control  had  a  great  deal  to  do  with  their  over- 
throw. The  people  are  not  afraid  of  the  people  in  New 
Zealand.  Changes  were  rung  on  every  political  platform 
that  the  fifteen  million  pounds  invested  in  the  railways  were 
the  property  of  the  public,  its  most  valuable  property,  and 
"the  people  demanded  to  be  represented  in  the  manage- 
ment of  this  property."  It  was  said  that  the  methods  of 
the  commissioners  and  the  commissioner  system  itself  were 
"an  insult  to  the  democracy."  "The  people  of  New  Zea- 
land," a  member  of  Parliament  said,  "are  the  real  stock- 
holders, and  Parliament  should  be  the  director." 

When  the  people  came  to  vote  they  voted-  by  a  large 
majority  along  these  lines.  Out  of  thirty-eight  members 
of  Parliament  who  had  declared  themselves  against  Par- 
liamentary control,  only  ten  were  returned  to  power. 

Premier  Seddon  introduced  a  bill  of  the  most  moderate 
character  at  the  beginning  of  the  new  session,  designed 
only  to  increase  the  voice  of  the  state  in  the  management 
of  the  roads  and  preparing  for  a  gradual  abolition  of  the 
commissioner  system,  but  with  the  first  day  it  became  evident 
that  when  the  debate  closed  the  government  would  be  in  sole 
control.  And  so  it  was.  Since  1894  New  Zealand  has  run 
its  railroads  with  the  hand  of  the  public  on  the  throttle. 


Mr.  Samuel  Vaile. 


ONE    MODERN    IMPROVEMENT  75 

The  Conservatives  who  had  put  the  railroads  in  charge 
of  the  commissioners  in  1887  made  it  in  the  campaign  of 
1899  one  of  their  grievances  that  the  Liberals  had  returned 
to  the  "political  administration  of  the  railways." 

The  sweeping  victory  of  the  ministry  in  the  election 
proved  that  the  change  had  been  to  the  satisfaction  of  the 
people.  The  statistics  of  the  railways  explain  the  popular 
satisfaction.  Rates  had  been  lowered,  revenues  increased. 

The  appeals  of  the  men  to  the  Appeal  Board  in  case  of 
grievances,  of  the  shippers  to  the  Minister  for  Railways  for 
better  export  rates  or  lower  freights  in  time  of  distress,  the 
delegations  from  communities  and  chambers  of  commerce 
on  construction  of  new  lines  or  the  purchase  of  private  lines, 
the  solicitous  replies  by  the  Minister  for  Railways  to  the 
manifestos  of  railway  reform  leagues,  the  large  space  in 
newspapers  and  Parliamentary  debates  occupied  by  railroad 
questions  are  all  indications  that  the  people  have  got  the 
'"representation"  in  the  management  of  highways  which 
they  demanded,  and  that  they  use  it.  Libraries  of  criti- 
cism and  of  statistical  comparisons  to  prove  that  freight 
rates  are  much  higher  and  accommodations  poorer  than 
those  of  countries  which  enjoy  the  blessing  of  private  owner- 
ship do  not  touch  one  point  at  least — and  that  is  that  the 
system  suits  the  New  Zealander  better  than  any  other,  and 
seems  to  the  people  most  concerned,  those  who  have  to  use 
the  railroads,  to  be  for  them  better  than  the  other,  both  as 
democracy  and  as  political  economy. 

The  participation  of  the  Australasian  people  in  the  settle- 
ment of  the  problems  of  communication  between  themselves 
may  perhaps  also  deserve  the  name  of  "modern  improve- 
ment" almost  as  much  as  gilded  buffets  and  electric  lights 
and  vestibuled  cars. 

A  New  Zealander,  Mr.  Samuel  Vaile,  of  Auckland,  claims 
the  credit  of  first  proposing  the  extension  of  the  post-office 


76  NO   "PUBLIC   BE   DAMNED" 

principle  to  railway  charges.  This  is  an  idea  which  has 
already  borne  great  fruit  in  other  countries,  as  in  Hungary. 
The  author  of  the  discovery  how  best  to  use  the  railroads 
is  likely  to  have  a  place  among  social  inventors  not  below 
the  Stephenson  who  taught  us  how  to  make  them. 

What  Mr.  Vaile  saw  among  the  poor  of  London — "no 
human  pen,"  he  says,  "can  adequately  describe  its  depth 
of  sorrow,  shame  and  degradation" — started  him  on  the 
search  for  the  "cause  and  cure  of  civilisation,"  as  Edward 
Carpenter  has  so  well  phrased  it. 

His  first  conclusion  was  that  the  prime  cause  of  poverty 
is  the  inability  of  the  people  to  make  use  of  the  land; 
and  his  second,  that  one  great  cause  of  this  is  the  system, 
or  no  system,  of  railway  management.  By  basing  the  rates 
on  mileage  and  putting  toll-gates  at  every  mile  the  rail- 
ways drive  out  of  the  country  and  crowd  into  the  cities 
the  people  and  their  industries.  These  must  shorten  the 
distances  between  each  other  if  they  are  to  live.  To  remedy 
this  Mr.  Vaile  invented  his  scheme  for  railway  zones.  In- 
stead of  making  the  railway  charge,  as  now,  increase  with 
the  mileage,  he  proposes  to  make  the  rates  dependent  on 
the  average  cost  of  the  service  and  the  density  of  the  popu- 
lation, and  to  vary  them  not  by  the  miles,  but  by  stages 
miles  long,  longest  in  the  thinly  peopled  districts,  shortest 
where  the  population  is  dense.  The  length  of  these  stages 
is  to  be  readjusted  after  every  census.  The  advantage  given 
to  the  smaller  places  and  the  sparsely  populated  and  poorer 
regions  under  this  method  would  disappear  as  they  made 
the  expected  gains  in  population  and  wealth.  The  number 
of  stages  would  then  be  increased  and  their  length  made 
less,  so  that  these  prospering  districts  would  take  a  larger 
share  of  the  general  burden. 

Sixteen  years  ago  Mr.  Vaile  proposed  this  partial  appli- 
cation to  railroad  charges  of  the  post-office  principle  of  uni- 


INVENTOR  OF  THE  ZONE   SYSTEM        77 

formity  regardless  of  distance — long  before  it  was  thought 
of  in  Hungary  or  in  Russia,  Denmark,  Sweden  or  Prussia, 
which  have  more  or  less  closely  followed  Hungary.  A 
prominent  Hungarian,  Baron  Huebner,  was  in  New  Zea- 
land while  Mr.  Vaile  was  pressing  his  principle  upon  Par- 
liament and  on  the  country,  six  years  before  Hungary  acted. 
For  sixteen  years  Mr.  Vaile  has  been  urging  his  plan  in 
his  own  country,  but  so  far  unsuccessfully.  His  pamphlets 
are  a  formidable  arraignment  of  the  turnpike  and  toll-gate 
system  on  which  the  railroads  of  the  world,  whether  public 
or  private,  and  whether  in  Australia,  New  Zealand,  Europe 
or  America,  are  run — the  exploded,  anti-post-office  principle 
of  different  rates  for  every  distance  and  every  kind  of  ship- 
ment. His  writings  and  speeches  contain  many  sharp  criti- 
cisms of  the  administration  of  the  New  Zealand  railroads, 
but  he  is  an  unswerving  advocate  of  public  ownership. 

The  zone  system  of  Hungary,  which  has  been  so  remark- 
able a  success,  is  but  a  mutilated  version  of  Mr.  Vaile's 
plan.  Its  results  are  well  known.  Rates  were  reduced  to  one 
fifth  of  their  former  average.  The  last  year  of  the  old  sys- 
tem the  number  of  passengers  was  9,056,500.  In  1897, 
ten  years  later,  this  had  increased  to  35,245,900.  And  the 
receipts  had  mounted  from  14,112,000  florins  to  26,951,677 
florins.  The  traffic  had  quadrupled  and  the  revenue  doubled. 
Equally  important  is  the  fact  that  the  average  distance  trav- 
elled by  each  passenger  increased  from  seventy-one  to  one 
hundred  and  thirty  kilometers,  or  nearly  twice. 

An  almost  unanimous  public  opinion  in  Australia  and 
New  Zealand  supported  the  change  we  have  described  above 
from  management  of  the  railroads  directly  as  "a  political 
department"  to  that  of  administration  by  "non-political 
commissioners."  Equally  unanimous  in  New  Zealand  was 
the  public  opinion  that  demanded  a  change  in  1893  back  to 
political  management.  But  even  now  that  the  people  have 


78  NO   "  PUBLIC   BE   DAMNED" 

got  political  management  they  are  not  satisfied,  and  the  agi- 
tation of  the  Canterbury  Reform  League  is  only  one  of  the 
signs  of  discontent.  The  persistence  of  public  complaints 
through  all  these  changes  indicates  that  there  is  a  more  rad- 
ical defect,  and  that  there  are  deeper  questions  which  the 
people  of  New  Zealand  have  not  yet  grasped.  Even  under 
public  ownership  the  democracy  has  not  yet  found  out  how 
to  make  a  democratic  railway  tariff. 

Where  every  mile  adds  to  the  charge  rural  traffic  is  under 
ruinous  inequality  as  compared  to  that  of  the  city.  Though 
less  able  to  pay  the  country  has  to  pay  the  most,  and  as  a 
matter  of  fact  pays  three  fourths  of  the  passenger  receipts 
of  New  Zealand  railways.  And  the  country  pays  nearly 
all  the  freight  charges.  Under  the  zone  or  post-office  sys- 
tem, as  worked  out  by  Mr.  Vaile,  the  zone  within  which  the 
charges  would  be  the  same  to  all  points  would  be  made  much 
larger  in  the  country  than  in  the  neighbourhood  of  the  cities. 
To  facilitate  the  settlement  of  the  country,  the  creation  of 
new  centres  and  the  relief  of  the  congestion  of  the  cities, 
people  and  goods  would  be  carried  much  greater  distances 
in  the  country  than  around  the  cities.  This  is  "equalisa- 
tion," but  so  is  the  post-office  and  the  suffrage  with  its  "one 
man  one  vote." 

As  the  business  of  the  roads  increased  Mr.  Vaile  would 
enlarge  the  zones,  carrying  people  farther  and  farther  for 
one  fare,  until  ultimately  there  would  be  only  one  fare  for 
any  distance. 

Instead  of  tickets,  railway  stamps  good  for  any  day  or 
any  direction  or  any  place  would  be  used  to  pay  fares,  and 
would  be  sold  by  the  post-offices  and  all  other  appropriate 
government  agencies.  These  rates  when  thus  cheapened, 
equalised  and  simplified,  would  be,  like  the  post-office  rates, 
unalterable  except  by  act  of  Parliament. 

This  zone  or  modern  post-office  idea  has  been  ably  advo- 


A  CHILD  COULD  TELL  THE  RATE    79 

cated  for  the  United  States  by  Mr.  James  L.  Cowles,  in  his 
"General  Freight  and  Passenger  Post."  It  has  also  been 
adopted  by  the  railroads  for  their  own  convenience,  as  in 
the  carriage  of  milk.  The  railroads  bring  the  babies  of 
New  York  their  daily  supply,  charging  one  rate,  no  matter 
what  the  distance  may  be.  They  charge  no  more  for  milk 
brought  three  hundred  miles  from  the  western  part  of  the 
State  than  that  hauled  from  Orange  County,  a  few  miles 
out  of  the  city. 

Results  in  Hungary  and  Russia  are  the  foretaste,  like 
the  wonderful  development  of  the  post-office,  of  the  social, 
industrial  and  other  benefits  to  be  expected  from  the  radical 
application  to  the  railroads  of  the  rule  of  uniformity  of 
charges  in  every  direction  regardless  of  distance  within 
the  zones,  with  the  whole  community  destined  ultimately 
to  be  one  zone. 

New  cities  would  spring  up.  People  would  be  encour- 
aged to  settle  on  the  land  in  unprecedented  numbers.  The 
workingmen  could  live  in  the  country  in  a  way  impossible 
now,  with  gain  of  independence  and  earning  power. 

The  zone  or  uniform  system  would  put  an  end  to  the 
oppressive  and  unjust  discriminations  now  so  commonly  ex- 
ercised by  private  enterprise  both  against  persons  and  places. 
There  would  be  no  possibility  of  the  political  use  of  rail- 
road power,  and  with  all  this  the  revenues  of  the  railroads 
would  increase  enormously,  as  is  proved  by  the  experience 
of  the  post-office  and  of  the  countries  that  have  adopted 
modifications  of  Mr.  Vaile's  idea. 

Railroad  rates  now  are  a  mystery,  and  the  officials  in  all 
countries  do  their  best  as  priests  of  transportation  to 
heighten  the  mystery  and  their  own  importance  and  power 
with  it.  There  are,  Mr.  Vaile  says,  thirty  million  different 
rates  on  the  Midland  Road  of  England.  Fraud  and  op- 
pression go  undetected  in  such  a  maze. 


8o  NO   "PUBLIC   BE   DAMNED" 

"The  whole  present  railway  system,"  Mr.  Vaile  says,  "has 
been  cradled  in  fraud  and  reared  in  corruption,  and  there 
will  be  no  real  lasting  progress  in  the  world  until  it  has 
been  entirely  swept  away." 

Under  the  post-office  principle  a  child  could  tell  the 
freight  or  fare  between  any  two  points,  and  no  rail- 
road official  could  vary  the  rates  to  build  up  the  business 
of  a  friend  or  to  kill  off  a  Naboth  whose  vineyards  are 
wanted. 

In  Hungary  the  zones  reach  only  from  one  station  to 
the  next.  But  Mr.  Vaile  proposes  that  the  zones  be  meas- 
ured by  distance,  no  matter  how  many  stations  are  included. 

Under  the  old  system  of  post-office  charges  only  a  few 
people  wrote  letters.  Now  everybody  writes.  Mr.  Vaile 
declares  that  the  application  of  the  post-office  system  to  the 
railroads  would  be  a  greater  event  in  the  development  of 
the  world  than  the  original  invention  of  the  railroads. 

Here  is  a  New  Zealand  idea,  which,  unlike  most  of  its 
ideas,  that  country  has  seen  put  into  practice,  though  im- 
perfectly, by  other  nations  than  itself.  But  Mr.  Vaile's 
faithful  agitation  for  sixteen  years  is  likely  to  bear  fruit  in 
New  Zealand  as  well  as  in  Russia  and  Hungary.  Several 
Parliamentary  committees  have  investigated  his  plan  and 
reported  that  it  should  be  tried.  The  present  Premier  gave 
it  favourable  consideration  as  long  ago  as  1892.  Every 
local  government  in  the  colony,  with  the  exception  of  three 
or  four,  has  petitioned  Parliament  to  make  the  experiment. 
Thousands  of  citizens  have  done  the  same.  A  combination 
of  wealthy  and  responsible  Auckland  citizens  have  made 
an  offer  to  bear  all  the  expense  of  a  trial  of  the  system  on 
the  roads  around  Auckland  at  their  own  risk  and  expense. 

Almost  every  member  of  the  present  ministry  of  New 
Zealand  has  voted  in  favour  of  it  when  a  member  of  Parlia- 
ment. Mr.  Vaile  is  now  pushing  his  agitation  with  re- 


SLAV  OR  ANGLO-SAXON?  81 

newed  energy,  and  is  urging  with  much  plausibility  that  the 
experiment  should  be  made  while  he  is  still  able  to  super- 
intend it,  for  the  railroad  officials  who  have  fought  it  first 
and  last  would  not  give  it  as  good  a  chance  as  the  creator 
of  the  idea  would  do. 

Sir  George  Grey,  whose  statesmanship  was  of  the  high- 
est order,  was  one  of  the  steadfast  friends  of  Mr.  Vaile' s 
plan,  and  when  Mr.  Vaile  was  given,  in  1893,  a  handsome 
service  of  plate  in  recognition  of  his  services  in  railroad 
reform,  Sir  George  made  the  presentation  speech  and 
warmly  eulogised  his  energy,  ability  and  patriotism. 

Mr.  Vaile  holds  that  the  future  supremacy  of  the  world 
will  rest  in  the  hands  of  the  people  who  best  know  how  to 
build  and  operate  railroads.  The  place  that  all  roads  lead 
to  is  the  place  that  rules.  Russia  has  adopted  the  zone 
system  of  railroad  charges  with  surprising  financial  results. 
This  readiness  of  the  Slavs  of  Hungary  and  Russia  to  apply 
this  new  theory  of  transportation,  multiplying  many  times 
as  it  does  the  service  of  the  road  to  the  people,  is  a  warning 
to  the  Anglo-Saxon  to  look  out  for  himself  in  the  struggle 
with  the  Slav  for  empire. 


CHAPTER   V 

THE    WORKMEN    ARE   THE    CONTRACTORS 

THE  men  who  are  seen  in  one  of  our  pictures  engaged  on 
the  Makohine  viaduct  are  ordinary  workingmen,  but  they 
are  not  working  in  an  ordinary  way.  They  are  their  own 
masters,  with  no  contractor  to  "sweat"  them  and  without  a 
contractor's  foreman  to  lash  them  with  his  tongue,  and  they 
are  working  co-operatively,  taught  and  helped  to  do  so  by 
the  New  Zealand  commonwealth. 

They  are  working  not  only  as  workless  men  given  work, 
but  as  landless  men  given  land  and  homeless  men  given 
homes.  Not  only  to  make  a  viaduct  or  a  railroad,  but  to 
change  into  orchards,  pastures  and  gardens  for  themselves 
and  their  children  the  forest  lands  which  the  state  will  give 
them  at  the  same  time  that  it  gives  them  a  job. 

One  of  our  pictures  is  of  an  encampment  where  the  men, 
and  in  some  cases  their  families,  are  living  in  tents  which 
the  people  had  ready  for  them  when  they  arrived,  but  which 
they  must  pay  for  out  of  their  earnings. 

These  pictures,  then,  illustrate  several  things  which  soon 
become  familiar  sights  to  the  New  Zealand  traveller — direct 
employment  by  the  state,  the  abolition  of  the  contractor,  the 
co-operative  system  of  public  works,  the  relief  of  the  unem- 
ployed, the  settlement  of  the  land,  and  treasury  advances  of 
money  to  farmers  and  workingmen. 

All  these  reforms  and  many  others  were  the  fruit  of  a 
radical  change  of  policy  effected  by  the  people  of  New  Zea- 

82 


ABOLISHING  THE  CONTRACTOR  83 

land  at  the  polls  in  1890.  The  contractor  was  one  of  the 
men  who  brought  this  on.  He  had  made  himself  almost 
as  obnoxious  to  the  workingman  and  the  people  as  the 
large  landowners  had  made  themselves  to  the  farmers.  In 
the  first  session  of  the  new  Parliament  one  of  the  members 
of  the  Labour  Party  said,  "There  is  no  other  system  in  the 
world  against  which  there  are  charges  so  serious  as  there 
are  against  this  pernicious  system  of  sub-contracting. 
Workingmen  have  been  robbed  wholesale." 

The  new  Premier,  John  Ballance,  had  the  grievances  of 
the  contract  system  before  him  as  one  of  the  things  to  be 
redressed  by  the  Liberal  administration,  and  in  his  opening 
speech,  bringing  forward  tax  reform  and  the  settlement  of 
the  people  on  the  land  as  the  first  things  demanding  atten- 
tion, he  pointed  out  that  the  land  reforms  he  proposed  would 
necessarily  do  away  with  the  contractor  in  public  works. 

The  abolition  of  the  contractor  and  the  deposit  of  the 
working  people  who  make  the  roads  as  permanent  settlers 
on  the  lands  alongside  the  roads  are  policies  that  came  in 
together  in  New  Zealand.  In  his  first  financial  statement 
Premier  Ballance  declared  that  the  former  method  of  car- 
rying on  public  works  in  New  Zealand  was  proved  to  be  rad- 
ically vicious,  since  those  engaged  upon  them  were  compelled 
to  migrate  as  soon  as  the  work  was  done.  "If  the  public 
works,"  he  said,  "had  been  made  subordinate  to  settlement, 
they  would  have  created  a  demand  for  population.  In  the 
way  they  have  been  conducted  they  have  been  instrumental 
in  driving  it  away.  Not  a  mile  of  road  or  railway  should 
be  constructed  by  the  colony  in  the  future  without  provi- 
sion being  at  the  same  time  made  for  the  location  of  the 
people  engaged  in  the  work  on  the  land,  if  possible,  in  the 
neighbourhood.  This  may  mean  a  radical  change  in  the 
method  of  entering  into  contracts,  and  it  certainly  will  en- 
tail a  more  direct  responsibility  upon  government;  but  it 


84  WORKMEN  CONTRACTORS 

will  transform  into  sturdy  settlers,  with  a  stake  in  the  coun- 
try, a  large  proportion  of  those  who,  seeing  no  prospect 
here,  are  ready  to  embark  for  other  lands.  With  a  view  to 
immediate  relief  and  stopping  the  exodus,  we  propose  to 
put  in  hand  such  public  works  as  are  of  a  reproductive  char- 
acter and  for  which  moneys  are  available.'' 

"We  have  had  large  estates  made  valuable  by  the  con- 
struction of  works,"  he  told  Parliament,  "and  yet  we  have 
not  increased  the  settlement  on  the  land.  Had  the  system 
of  co-operation  obtained  in  years  gone  by — had  lands  ad- 
joining the  works  been  thrown  open  for  settlement  as  the 
works  progressed,  had  those  employed  shared  in  the  profits 
in  addition  to  their  wages,  which  is  the  principle  of  the  co- 
operative system,  then,  as  they  shared  the  profits,  so  they 
would  have  taken  up  the  lands  and  settled  thereon.  It  is 
necessary  that  a  remedy  should  be  devised  for  the  mistakes 
of  the  past,  and  that  remedy  is  the  construction  of  works 
on  the  co-operative  system,  and  the  simultaneous  throwing 
open  of  lands  for  settlement  in  the  vicinity  of  the  works. 
The  work  will  not  cost  the  colony  any  more,  and  a  large 
portion  of  the  money  expended  on  the  same  will  come  back 
to  the  treasury  in  the  shape  of  payments  made  for  the  pur- 
chase or  rent  of  lands." 

At  the  very  beginning  the  new  ministry  found  itself 
compelled  to  find  work  for  the  unemployed,  and  in  doing 
so  it  instituted  the  system  of  building  roads  and  other  public 
works  by  giving  contracts  directly  to  the  workmen  organised 
in  co-operative  groups. 

It  seems  at  first  as  if  it  were  a  mere  detail  of  adminis- 
tration, this  making  the  workingmen  the  contractors,  but  it 
is,  in  truth,  an  essential  part  of  the  reforms  in  land,  labour 
and  taxation  which  distinguish  New  Zealand  democracy. 

The  Honourable  Richard  J.  Sedclon,  now  Premier  of  New 
Zealand,  was  the  first  Minister  for  Public  Works  in  the  new 


Premier  Seddon. 


(Page  84.) 


DIGGER   DICK  85 

regime.  He  had  been  a  workingman,  and  he  is  of  that  not 
too  common  type  of  rising  man,  one  who  does  not  rise  out 
of  remembrance  of  the  lot  of  those  he  leaves  behind  him. 

The  most  democratic  country  is  the  one  which  has  the 
greatest  political  stability.  The  Liberal  Party  now  in  power 
in  New  Zealand  has  had  the  administration  in  its  hands  since 
the  election  of  1890,  and  the  present  Premier  has  been  at 
its  head  since  1893.  The  election  of  1900  insures  his 
tenure  until  1903,  unless  he  or^iis  party  break  down.  This 
is  a  record  not  to  be  matched  by  the  leader  of  any  other 
democracy  of  the  day  except  Mexico,  and  Mexico  is  not 
so  much  a  democracy  as  an  autocracy  tempered  by  the  great- 
ness of  the  autocrat  Diaz.  The  present  Liberal  regime  in 
New  Zealand  is  the  farthest  possible  from  resembling  the 
one-man  power  that  has  given  to  Mexico  so  long  a  stretch 
of  prosperity.  But  there  can  be  no  doubt  that  the  person- 
ality of  Mr.  Seddon  has  been  a  factor  of  calculable  impor- 
tance in  the  achievements  with  which  New  Zealand  to-day 
challenges  the  attention  of  the  world. 

Mr.  Seddon  towered  among  the  Australasian  premiers  at 
the  Queen's  Jubilee,  and  they  were  all  notable  men.  He 
alone  of  them  survives  politically. 

Of  sturdy  Lancashire  farming  stock,  young  Seddon  chose 
an  engineer's  trade,  and  with  a  Board  of  Trade  certificate 
of  his  capability,  arrived  in  Victoria  in  1863,  eighteen  years 
of  age.  The  gold  fields  at  Bendigo  and  later  the  West 
Coast  gold  discoveries  of  New  Zealand  in  1866  offered  him 
chances  for  fortune,  and  New  Zealand  made  its  promise 
good.  Any  miner  he  saw  at  the  mercy  of  a  bully  was  sure 
of  a  champion  in  Digger  Dick.  He  became  a  miners'  ad- 
vocate before  the  wardens  who  had  the  decision  of  mining 
disputes.  Most  miners  dig  down,  Digger  Dick  dug  up. 
He  made  himself  the  head  of  a  successful  mercantile  busi- 
ness. He  became  a  member  of  road  boards  and  provincial 


86  WORKMEN  CONTRACTORS 

councils,  and  of  the  Board  of  Education;  he  was  elected 
Mayor  of  Kumara,  and  in  1879  a  member  of  Parliament. 
He  has  remained  in  Parliament  from  then  till  now,  and  is 
the  only  member  who  has  that  record  of  continuous  service. 
He  is  the  father  as  well  as  the  leader  of  Parliament. 

Men  and  affairs  have  been  his  books,  life  his  school,  the 
House  of  Representatives  his  university.  When  the  Lib- 
eral party  came  in  he  was  made  Minister  for  Public  Works 
by  Ballance.  When  Ballaijce  died  at  a  moment  so  un- 
timely that  it  almost  seemed  as  if  the  Liberal  cause  must 
die  with  him,  Seddon  was  called  by  the  party  to  its  head, 
where  he  has  ever  since  remained.  He  is  fond  of  describ- 
ing himself  as  the  premier  of  the  paradise  of  the  British 
Empire.  No  one  knows  the  political  value  of  an  idea  or  a 
man  as  Seddon  does.  His  mind  and  his  body  are  both 
remarkable.  It  was  said  of  Daniel  Webster  that  he  was 
a  steam-engine  in  trousers.  Mr.  Seddon  is  more  than  that, 
as  becomes  his  later  date;  he  is  a  dynamo.  In  addition  to 
an  extraordinary  equipment  of  intellectual  and  physical 
vigour,  he  has  an  inborn  sympathy  with  the  people  and  all 
that  concerns  them.  Some  statesmen  have  democracy  thrust 
upon  them,  a  few  achieve  it,  one  or  two  in  a  century  get  it 
by  heart  or  by  ear.  Seddon  is  a  born  democrat.  He  and 
the  Honourable  C.  C.  Kingston,  Premier  of  South  Australia 
when  I  was  there,  are  two  as  fine  figures  as  one  can  see  any- 
where among  the  steersmen  of  ships  of  state.  Both  are 
equally  true  to  the  cause  of  progress  and  the  people,  but  they 
are  of  totally  different  types.  Seddon  is  a  new  man  fresh 
from  the  multitude.  Kingston  has  a  distinguished  family 
record  to  live  up  to.  Seddon  is  a  democratic  democrat, 
Kingston  an  aristocratic  democrat. 

Seddon  is  solid  with  the  workingmen  for  his  unvarying 
championship  of  them  from  his  earliest  days.  He  is  solid 
with  the  country  people  for  the  tenacity  with  which  he  has 


A   HEART   WHICH   THINKS  87 

fought  for  their  land  and  tax  and  money  reforms.  He  is 
solid  with  the  progressives  for  the  courage  and  initiative 
of  his  radicalism.  Seddon  is  always  in  the  advance.  It 
would  not  have  been  surprising,  after  the  rapid  onward 
march  of  the  last  ten  years,  if  he  had  wanted  to  rest  on  his 
laurels.  But  all  through  the  last  campaign  he  was  throw- 
ing out  intimations  of  a  still  more  forward  policy.  He 
does  not  hesitate  to  assure  the  great  landlords  that  they 
may  expect  still  heavier  taxation.  He  has  warned  the  coal 
ring  that  he  is  ready  if  necessary  to  put  the  state  into  the 
coal  business,  and  the  shipping  ring  that  he  will  favour  the 
nationalisation  of  steamships  if  needed  to  curb  their  ex- 
actions. 

He  is  not  a  statesman  of  one  idea,  not  even  of  so  good 
an  idea  as  democracy.  When  I  asked  him  how  the  count- 
less things  were  going  to  get  themselves  done  which  ought 
not  to  be  left  to  competition,  but  could  not  be  done  by  the 
state  because  not  even  in  New  Zealand  is  the  state  far 
enough  advanced  to  undertake  them,  he  replied,  "Co-oper- 
ation will  take  care  of  them."  Though  he  has  probably  never 
had  time  to  read  a  book  on  co-operation,  he  reached  by 
intuition  the  conclusion  which  is  developing  in  the  minds 
of  our  best  political  philosophers,  that  co-operative  and  dem- 
ocratic industry  are  the  two  hemispheres  which  will  make 
up  the  social  world  of  the  future.  While  waiting  for  the 
nationalisation  of  the  coal  mines  he  leases  a  mine  under  the 
control  of  the  state  to  a  coal  miners'  trade-union  to  be 
worked  co-operatively. 

Seddon  is  strong  with  men  and  women  alike,  and  he 
softens  the  antagonism  even  of  political  opponents  by  a 
policy  which  he  expresses  in  a  favourite  phrase,  "We 
must  take  a  kindly  view  of  human  nature."  His  defence  of 
the  old-age  pension  and  the  co-operative  works  and  other 
humanitarian  measures  is  always  touched  by  a  tender  sym- 


88  WORKMEN  CONTRACTORS 

pathy  for  the  old  and  unfortunate.  Though  a  paragon  of 
physical  strength,  he  is  never  ashamed  to  show  that  senti- 
ment plays  a  large  part  in  his  views  of  public  matters  and 
that  he  has  a  head  that  feels  and  a  heart  that  thinks. 

The  first  discovery  he  made  on  taking  his  office  as  Min- 
ister for  Public  Works  was  that,  although  the  contractors 
who  were  doing  the  public  works  were  forbidden  by  the 
explicit  terms  of  their  contract  to  sub-let,  they  were  prac- 
tically all  sub-letting,  and,  what  was  worse,  the  public  offi- 
cials were  conniving  at  it  and  treating  the  prohibition  as  a 
dead  letter. 

Minister  Sedclon  put  a  stop  to  all  this.  "It  was  the 
sweating  system,"  he  said,  "in  its  most  flagrant  and  baleful 
aspects."  These  contractors  took  work  at  a  price  out  of 
which  they  could  not  make  a  legitimate  profit,  and  then  sub- 
let to  make  money  at  the  expense  of  the  workman.  The 
last  state  of  the  district  which  at  first  had  congratulated 
itself  on  getting  an  appropriation  for  some  road  or  bridge 
was  often  worse  than  the  first.  The  contractor  would  bring 
his  own  men  with  him ;  the  news  of  the  improvement  would 
attract  a  large  number  of  outsiders;  the  contractor  would 
then  run  away,  and  the  people  would  be  left  with  the  labour 
problem  tripled.  They  would  have  on  their  hands  their  own 
labourers,  those  whom  the  contractor  had  brought  in,  and 
those  who  had  come,  as  the  Australians  say,  "on  their  own." 
Meanwhile,  in  other  districts,  no  labourers  could  be  got. 
The  tradesmen  who  supplied  material  to  the  contractors  and 
subsistence  and  other  things  to  the  men  had  frequently  to 
go  unpaid.  The  work  was  done  in  a  slovenly  way.  It 
was  almost  always  delayed. 

The  contractor  used  to  try  to  get  on  the  right  side  of 
the  engineer  or  surveyor  and  obtain  extra  allowances.  He 
would  put  on  an  especially  good  man  or  two  in  each  gang, 
pay  them  more  by  private  arrangement,  and  set  a  killing 


THE  CO-OPERATIVE  GANG  89 

pace  for  the  other  men.  "He  would  establish  a  store  to 
soak  up  the  wages;  he  would  have  a  sardine  can  in  front 
and  a  whisky  bottle  behind." 

"We  made  up  our  minds  to  stop  that,"  Mr.  Seddon  said, 
"and  introduce  the  co-operative  method  which  is  now  in 
use."  An  affair  soon  occurred  to  make  a  practical  issue  of 
the  evils  of  the  contractor  system  and  call  for  an  applica- 
tion of  the  principles  of  the  new  party. 

The  contractors  who  had  undertaken  to  build  the  Nga- 
kawau  railroad  extension  to  Mokihinui  under  a  very  liberal 
arrangement,  no  deposit,  for  instance,  being  required,  threw 
up  the  work,  perhaps  with  the  expectation  of  forcing  still 
better  terms.  Going  to  Westport,  Minister  Seddon  found 
a  large  number  of  men  who  had  flocked  there  from  different 
parts  of  the  colony,  expecting  to  get  employment  on  the 
construction  of  this  railway.  To  avoid  the  delay  that  call- 
ing for  fresh  tenders  would  have  involved,  he  decided  to  let 
the  sections  referred  to — three  in  number — to  the  men  them- 
selves, and  on  a  new  plan — on  the  co-operative  principle. 
He  asked  the  men  to  divide  themselves  into  parties  of  about 
fifty  each,  and  to  select  from  each  party  certain  trustees  to 
take  the  work  from  the  department  in  the  ordinary  way,  but 
the  work  itself  to  be  done  by  the  whole  of  the  men,  each  one 
having  equal  interests  with  his  fellows,  the  price  to  be  fixed 
by  the  engineer  in  charge  of  the  work.  On  this  plan  the  men 
went  to  work  in  a  few  days.  As  often  occurs  when  new 
methods  are  adopted,  there  was  a  little  friction  at  first,  and  a 
little  difficulty  in  the  classification  of  the  men.  The  strong 
and  able-bodied  did  not  altogether  like  to  work  for  the  aged 
and  the  feeble.  Both  the  men  and  the  work  were  there- 
upon classified — the  lighter  work  was  given  to  the  aged  and 
less  capable  men. 

"Under  the  previous  system,"  Minister  Seddon  reported, 
"the  government  had  been  paying  only  $1.12  a  day  to 


90  WORKMEN  CONTRACTORS 

the  men.  The  state  received  but  a  poor  return  for  its 
pittance,  as  no  interest,  of  course,  was  taken  in  the  work. 
Now  the  men — some  seventy  in  number — are  paid  so  much 
per  chain  for  the  work,  and  the  total  cost  has  not  exceeded 
what  it  would  have  been  had  the  work  been  done  by  con- 
tract, and  the  men  employed  are  well  satisfied.  Men  who 
had  been  working  under  the  old  system,  and  whom  the  over- 
seers had  considered  not  to  be  able  to  do  a  fair  day's  work, 
and  who  were  consequently  not  worth  even  the  43.  6d.  per 
day  which  were  paid,  have  turned  out  excellent  work,  and 
are  moreover  anxious  and  eager  to  do  it.  Instead  of  being 
disappointed  and  complaining,  as  they  were  in  the  past, 
they  have  been  made  happy  and  contented,  and  have  been 
able  to  put  by  a  little  money.  An  entirely  new  phase  has, 
in  fact,  been  put  on  the  whole  business." 

In  reporting  the  success  of  this  experiment  to  Parliament, 
Minister  Seddon  prophesied  that  it  would  "ere  long  be  rec- 
ognised as  the  broad  system  on  which  our  public  works 
should  be  constructed." 

This  anticipation  has  been  realised,  and  from  year  to 
year  since  then  more  and  more  of  the  public  works  have 
been  taken  from  the  contractors  and  have  been  given  to 
co-operative  gangs  of  workmen. 

Expensive  public  buildings  are  now  put  up  in  large  part 
in  that  way  all  over  New  Zealand.  The  government  print- 
ing office  in  Wellington  is  an  instance,  and  even  compli- 
cated bridges  are  now  erected  by  co-operative  bodies  of 
mechanics  and  artisans. 

There  were  mistakes  at  first,  of  course.  The  co-opera- 
tive parties  were  made  too  large.  It  was  found  impossible 
to  get  thirty  or  forty  men  who  were  so  nearly  equal  that 
they  could  work  together  harmoniously.  The  size  of  the 
groups  was  reduced  until  now  the  minimum  is  four.  The 
officers,  too,  accustomed  to  deal  only  with  contractors,  found 


NO   INCREASE   IN    COST  91 

this  an  entirely  different  thing,  and  found,  too,  that  the  sub- 
division of  the  work  and  increase  in  the  number  of  con- 
tractors— for  every  party  of  workingmen  was  a  contractor — 
was  a  serious  addition  to  their  labours. 

One  very  practical  advantage  was  experienced  in  the 
first  year.  It  was  found  necessary  for  financial  reasons 
to  cut  down  expenditures  in  1891.  Under  the  contract 
system  this  could  not  have  been  done  without  incurring 
claims  from  the  contractors  for  heavy  compensation,  but 
the  agreement  with  these  co-operative  groups  reserves  the 
privilege  of  suspending  operations  at  any  time  without  any 
liability  for  damages. 

One  of  the  apprehensions  with  which  the  scheme  was  re- 
garded was  also  proved  to  be  groundless.  It  had  been  pre- 
dicted that  political  pressure  would  prevent  the  discharge 
of  men  and  compel  employment  to  be  given  out  for  which 
there  was  no  real  need.  But  this  was  put  to  the  proof  by 
the  discharge  of  a  large  number  of  men  engaged  on  the  co- 
operative works  without  the  slightest  suggestion  of  resis- 
tance or  any  political  pressure  by  the  men. 

In  the  first  year  the  system  was  extended  from  the  con- 
struction of  ordinary  roads  and  the  earthworks  of  railroads 
to  larger  matters  requiring  skilled  labour.  Railroad  cul- 
verts of  brick  and  stone  and  concrete  and  some  small 
bridges  were  successfully  attempted.  The  laying  of  the 
rails  and  the  building  of  stations  and  similar  work  were 
still  let  out  by  contract. 

The  minister  adhered  to  the  principle  he  laid  down  at 
the  commencement,  that  work  should  be  done  co-operatively 
only  if  it  could  be  done  at  no  greater  cost  to  the  public 
than  by  contract. 

He  was  able  to  announce  in  his  report  for  1892  that 
"the  works  are  carried  out  in  a  more  satisfactory  manner 
than  under  contract  and  at  no  increase  in  cost." 


92  WORKMEN   CONTRACTORS 

The  men  put  at  work  in  this  way  are  uniformly  unem- 
ployed, sent  out  by  the  Labour  Bureau.  Work  on  the  Mo- 
kau  section  of  the  North  Island  Main  Trunk  Railway  was 
given  in  this  year  co-operatively  to  one  hundred  and  fifteen 
men,  seventy-five  of  whom  were  unemployed,  from  the 
agency  of  the  National  Labour  Bureau  at  Auckland.  The 
men  were  divided  into  parties,  usually  of  about  ten  each, 
and  the  work  was  let  to  them  in  pieces  of  various  lengths, 
at  prices  fixed  by  the  engineers.  Their  average  net  earn- 
ings were  7^.  to  &y.  a  day  for  eight  hours. 

This  success  is  especially  noteworthy  in  comparison  with 
the  failure  of  the  more  ambitious  co-operative  villages  at- 
tempted by  South  Australia  and  New  South  Wales — fail- 
ures perhaps  because  more  ambitious. 

It  is  not  only  the  unemployed  from  the  cities  that  benefit 
by  this  plan,  but  especial  pains  are  taken  to  make  it  feed 
with  work  the  small  settlers  already  given  homesteads  and 
needing  more  income  to  supplement  the  produce  of  their 
farms. 

By  1893  the  system  had  been  extended  to  the  greater 
part  of  the  public  works.  It  was  found  to  be  as  well 
adapted  for  laying  the  permanent  way  and  constructing  sta- 
tion buildings  as  for  the  earthworks,  culverts,  etc.,  which 
were  all  that  had  been  at  first  ventured  upon. 

The  extension  of  the  co-operative  method  to  the  more 
difficult  parts  of  railroad  construction,  like  bridge  building 
and  track  laying,  proved  so  successful  that  in  1893  Mr. 
Seddon  had  the  courage  to  carry  it  a  step  further — that  is, 
to  public  buildings — and  again  with  the  best  results. 

The  first  building  attempted  co-operatively  was  the  Te 
Aro  railway  station  at  Wellington.  The  supplies  of  tim- 
ber and  other  materials  for  the  buildings  were  obtained  by 
tender,  but  the  work  of  erection  was  let  to  co-operative  par- 
ties. The  new  government  printing  office,  one  of  the  promi- 


A  Co-operative  Group  at  Work. 


(Page  93.) 


EVERY  BRICK   CO-OPERATIVE  93 

nent  buildings  of  the  capital,  Wellington,  adjoining  the  Gov- 
ernment House,  was  begun  in  1895  co-operatively  and  car- 
ried through  to  completion.  The  levelling  of  the  ground 
and  the  preparation  of  the  site  was  given  to  co-operative 
labourers ;  a  co-operative  group  of  bricklayers  took  the  con- 
tract for  the  brickwork;  the  woodwork  was  let  to  a  group 
of  carpenters ;  similarly,  the  plumbing  was  given  to  co-oper- 
ative plumbers,  and  so  on.  As  the  Minister  for  Public 
Works  said  with  pride,  " Every  brick  was  laid  in  co-opera- 
tion." But  he  points  out  that  this  method  cannot  be  as 
easily  or  successfully  applied  to  buildings  as  to  the  simpler 
work  of  railways,  and  the  like.  When  the  Supreme  Court 
at  Wellington  was  to  be  painted,  the  lowest  tender  from  con- 
tractors was  almost  double  the  price  at  which  the  work  was 
finally  done  by  painters  employed  co-operatively. 

In  one  or  two  cases  the  workingmen  clubbed  together  and 
made  gifts  to  the  engineers  in  charge.  This  kind  of  co- 
operation was  not  what  the  government  was  fostering,  and 
notice  was  given  that  no  more  of  it  would  be  allowed. 

The  state  took  parental  notice  of  the  fact  that  some  of 
the  men,  unable  to  endure  the  transition  from  the  complete 
impecuniosity  of  idleness  to  the  sudden  wealth  of  a  govern- 
ment job,  were  spending  their  money  foolishly.  It  insti- 
tuted the  system  of  remittances  to  the  "folks  at  home," 
which  are  spoken  of  in  another  place. 

The  next  winter,  1894,  was  a  very  hard  one.  The  har- 
vests had  been  exceptionally  bad,  and  this,  with  declining 
prices,  brought  the  industries  of  New  Zealand  to  a  low  ebb 
and  threw  many  out  of  work. 

The  pressure  of  all  this  was  felt  at  once  by  the  Public 
Works  Department,  which  recognised  in  Mr.  Seddon's  words 
that  it  devolved  upon  the  commonwealth  to  make  provision 
to  alleviate  as  far  as  possible  the  wants  of  those  who,  through 
no  fault  of  their  own,  were  idle, 


94  WORKMEN   CONTRACTORS 

As  the  settlement  of  the  people  on  the  land  is  the  key- 
note of  this  policy,  as  of  all  New  Zealand  policy,  Minister 
Seddon,  in  getting  his  unemployed  to  work  in  this  emer- 
gency in  the  winter  of  1894,  put  them  on  roads  and  on 
clearing,  and  other  preparation  of  Crown  lands  for  settle- 
ment. The  farmers  had  made  complaints  in  previous  years 
that  the  absorption  of  the  floating  labour  had  been  an  injury 
to  them  during  the  summer  months.  This  year  the  need  for 
help  in  the  harvest  fields  was  met  by  slackening  the  oper- 
ations on  roads,  railways  and  other  works  and  setting  the 
men  free  to  go  to  the  farmers. 

The  fame  of  the  new  method  had  gone  abroad,  and  the 
minister  took  a  justifiable  pride  in  making  it  known  that 
he  had  received  official  inquiries  from  Victoria,  New  South 
Wales  and  other  colonies,  and  from  the  American  and  Brit- 
ish governments.  But  his  confident  expectation  that  the 
co-operative  method  would  be  largely  adopted  in  other  coun- 
tries has  not  been  fulfilled. 

One  of  the  reasons  for  this  disappointment  is  that  this 
reform  is  of  little  significance  by  itself.  It  is  only  one  egg 
in  a  nest  of  reform  eggs.  It  means  little  to  the  country 
that  is  not  prepared  to  put  forward  with  it  a  sincere  and 
extensive  programme  of  the  restoration  of  the  land  to  the 
people  and  the  people  to  the  land  and  of  reproductive  public 
works  to  make  the  people  and  the  land  ready  for  each  other. 

By  1894  it  had  become  a  regular  thing  that  the  track 
laying  and  the  construction  of  the  railway  stations  and  of 
all  but  the  most  difficult  bridges  should  be  done  by  co- 
operative labour.  This  year  eighty-three  co-operative 
contracts  were  made  for  railway  sleepers,  nearly  all  of 
them  with  settlers  and  workingmen.  Post-offices,  asylums 
and  other  public  buildings  were  being  put  up  and  re- 
paired wherever  possible  by  the  "co-operative  contractors." 
Times  were  again  hard  in  the  winter  of  1895,  and  again  the 


A   CHANCE   FOR   OLD    MEN  95 

government,  owing  to  the  dearth  of  private  employment, 
increased  its  co-operative  force.  The  criticism  made  at  first 
that  the  work  would  be  more  expensive  than  if  done  by 
private  contractors  had  been  proved  mistaken,  and  it  was 
now  succeeded  by  the  assertion,  based  on  the  published  re- 
ports of  the  average  earnings  of  the  men,  that  the  state 
itself  had  become  a  sweater  and  was  paying  the  men  too 
little.  It  was  true  that  the  earnings  of  the  men  often 
seemed  to  be  less  than  those  paid  by  contractors,  but  the 
explanation  of  this  when  made  only  served  to  increase  the 
popular  appreciation  of  the  plan.  Many  of  the  men  employed 
were  old,  many  wholly  inexperienced,  many  were  defec- 
tives, many  were  skilled  artisans,  like  the  printers,  who  had 
never  before  done  the  kind  of  work  they  were  now  offered. 
Of  course  the  average  earnings  of  such  a  force  would  be 
less  than  the  average  of  competent  men  picked  by  con- 
tractors. 

Capitalism  refuses  standing  room  on  the  industrial  foot- 
stool to  old  men,  often  to  middle-aged  men,  and  even  mar- 
ried men,  but  the  state  in  New  Zealand  finds  that  they  have 
an  economic  value,  and  for  the  sake  of  humanity  and  the 
social  economy  gives  them  a  chance.  In  a  speech  at  Auck- 
land just  before  election,  the  Premier,  referring  to  the  an- 
nounced purpose  of  the  Opposition,  if  successful,  to  do 
away  with  the  co-operative  system  and  return  to  the  con- 
tractor— "to  the  days  of  sweating  and  of  truck  stores  kept 
by  contractors'  relatives" — made  it  a  strong  point  of  his 
appeal  to  the  people  to  sustain  his  administration,  that,  while 
under  the  contractors,  old  men  could  not  get  work,  they 
have  on  the  co-operative  works  just  as  much  right  as 
young  men. 

A  very  happy  idea  was  put  into  operation  this  year  to 
facilitate  the  conversion  of  the  co-operative  workingmen 
into  farm  settlers.  Wherever  land  was  available  for  set- 


96  WORKMEN   CONTRACTORS 

tlement  by  these  men,  their  working  time  was  divided  be- 
tween the  government  and  the  farms  allotted  them  out  of 
public  land.  The  married  men  were  to  have  four  days'  co- 
operative employment  in  each  week,  and  were  to  be  allowed 
to  absent  themselves  the  other  two  days  to  improve  their 
farms.  Single  men  were  to  divide  their  time  equally.  This 
reduced  the  outlay  on  public  works,  and  at  the  same  time 
hastened  the  permanent  "deposit  of  the  men  on  the  land." 

Almost  every  item  in  page  after  page  of  the  reports  of 
the  Public  Works  Department  as  to  the  railroads,  bridges, 
station  houses,  roads,  jails,  asylums,  court  houses,  post- 
offices,  quarantine  buildings,  and  official  residences  contains 
a  line  like  this :  "The  work  is  being  done  on  the  co-operative 
principle,  and  with  satisfactory  results." 

Until  1896  there  had  been  no  attempt  at  iron  bridge  con- 
struction, but  when  the  tenders  for  the  Mahokine  viaduct 
were  received  and  the  lowest  was  found  to  be  several  thou- 
sand pounds  in  excess  of  the  chief  engineer's  estimate,  it  was 
decided  to  carry  out  the  work  under  co-operative  contracts. 

Arrangements  were  accordingly  made  for  the  supply  of 
the  iron  and  steel  and  other  material,  and  co-operative  con- 
tracts were  let  to  groups  of  labourers  for  the  excavations, 
and  to  masons  for  the  building  of  the  concrete  piers  and 
foundations,  and  to  iron  and  steel  workers  for  the  prepara- 
tion and  erection  of  the  bridge  itself.  These  different  kinds 
of  contracts  were  let  separately,  for  it  is  not  found  advis- 
able even  in  democratic  New  Zealand  to  have  labourers  and 
mechanics  in  the  same  party.  The  structure  is  costing  less 
than  if  erected  under  the  lowest  tender  offered,  and  a  bridge- 
building  plant  is  being  acquired  which  \vill  be  available 
for  use  in  the  erection  of  other  viaducts  and  bridges  as  they 
may  be  called  for. 

The  co-operative  system  by  this  time  had  been  in  opera- 
tion for  five  years.  The  total  expenditure  on  these  works 


Unemployed  Building  the  Mahokine  Viaduct. 


(Page  96.) 


WHAT   THE   MEN   GET  97 

was  $4,649,810,  nearly  equally  divided  between  the  Public 
Works  Department  and  the  Lands  Department,  and  of  this 
sum  no  less  than  $3,054,705  had  been  paid  directly  to  the 
workingmen  as  the  value  of  their  labour.  There  had  been 
constructed  altogether  co-operatively  172  miles  of  railroads, 
i, 1 80  miles  of  other  roads,  and  a  great  variety  of  public 
buildings.  There  had  been  employed  altogether  8,259  men, 
about  equally  divided  between  the  two  departments. 

It  will  be  worth  while  to  note  the  average  earnings  a 
day  by  the  different  kinds  of  workingmen  thus  engaged,  re- 
membering that  this  average  is  the  average  for  elderly  men 
as  well  as  young  men,  and  delicate  men  as  well  as  hardened 
navvies.  The  ordinary  day  labourer  had  earned  an  average 
of  js.  2d.,  or  $1.89;  the  carpenters  Ss.  id.  to  8s.  Sd.,  or 
$2.02  to  $2.16.  The  masons  and  bricklayers  los.  8d., 
or  $2.66,  the  plumbers  los.  iod.,  $2.70,  and  the  plasterers 
I2s.,  $3.  To  show  the  comparative  cost  of  railways  con- 
structed under  the  two  systems  the  government  has  pre- 
pared a  table  giving  the  mileage  cost  of  railroads  built 
under  similar  conditions  by  contract  and  by  itself  under 
the  co-operative  system.  In  every  case  the  railroads  built 
co-operatively  cost  less.  The  smallest  difference  was  $33,- 
570  a  mile  by  contract  against  $33,460  by  co-operative  la- 
bour, and  the  largest  difference  was  $43,910  by  contract 
against  $39,575  by  co-operation. 

Of  course  the  state  has  to  go  without  the  gains  it  might 
make  when  some  contractor  has  to  finish  his  job  at  a  loss, 
but  since  in  that  case  the  contractor  almost  always  goes 
"bung,"  as  the  Australian  phrase  has  it,  or  if  he  has  means 
and  influence  will  usually  find  some  way  out  of  his  em- 
barrassment, the  common  result  of  speculating  on  the  bad 
guesses  of  a  contractor  is  a  loss,  not  a  profit.  The  public 
gets  his  losses  and  never  shares  his  winnings.  In  one  of 
the  New  Zealand  railroad  works  the  track  was  to  have 


98  WORKMEN   CONTRACTORS 

been  ballasted  with  broken  stone  at  a  cost  of  about  sixty 
cents  a  yard.  Just  at  the  moment  when  the  ballasting  was 
about  to  begin  a  deposit  of  scoria  ash — a  much  superior  ar- 
ticle— was  found,  and  so  conveniently  situated  that  it  cost 
only  twelve  cents  a  yard  delivered.  As  the  work  was  being 
done  under  the  co-operative  plan  by  the  state  itself  the 
saving  by  this  discovery  all  went,  not  to  some  fortunate 
contractor,  but  to  the  taxpayers. 

The  new  underground  rapid  transit  road  now  being  built 
in  New  York  will  destroy  miles  of  the  Broadway  Boulevard 
parkway,  with  beautiful  trees,  lawns  and  shrubs,  made  at 
great  expense  of  time  and  money.  The  engineers  in  laying 
out  the  course  of  the  work,  evidently  neglecting  to  walk 
over  the  route,  forgot  the  parkway  and  put  the  tunnel  di- 
rectly under  it.  The  construction  will  therefore  destroy  all 
this  beauty,  which  might  have  been  a  heritage  of  joy  for- 
ever. To  change  the  plans  so  that  the  tunnel  shall  go  to 
one  side  and  the  parkway  be  saved  would  be  the  simplest 
possible  matter;  it  would  involve  only  a  few  days'  calcu- 
lations in  the  engineer's  office.  If  the  city  were  building 
the  tunnel  this  correction  would  undoubtedly  be  made  and 
priceless  values  be  rescued,  but  the  work  is  in  the  hands  of 
a  contractor,  and  the  slightest  delay  or  the  least  change  in 
the  plans  would  be  at  once  seized  upon  by  him  as  a  basis 
for  claims  of  millions  of  dollars'  damage.  The  people  must 
stand  helpless  and  see  their  boulevard  ruined  forever. 

The  government  cannot  hurry  a  contractor,  but  it  can 
expedite  itself  as  it  will.  If  any  emergency  requires  that  the 
number  of  men  be  increased  and  the  work  hastened,  it  has 
the  thing  in  its  own  hands  under  the  co-operative  system, 
and  there  is  no  one  to  demand  that  bugbear  of  all  who  have 
to  deal  with  contractors — "extras." 

Another  point  of  practical  importance  is  the  superiority 
of  material.  Under  co-operative  work  the  government,  as 


EVERY   ONE   AN   OVERSEER  99 

we  saw  in  the  Makohine  viaduct,  finds  its  own  materials 
and  naturally  selects  the  best.  The  workingmen  are  not 
instructed  to  stint  material  to  make  savings  for  the  con- 
tractors, and  the  official  overseers  prevent  waste.  The  de- 
mocracy puts  no  whiting  into  its  paint  instead  of  white  lead, 
and  does  not  use  the  poorer  brands  of  cement  or  iron.  Nor 
does  it  build  its  walls  dry  in  the  centre,  nor  fill  them  in  with 
brickbats.  The  men  work  better  and  faster  with  sound 
materials  than  with  rubbish. 

As  the  men  are  the  contractors  themselves  the  workman- 
ship put  in  also  is  of  a  superior  kind,  for  it  is  the  taskmas- 
ter himself  who  does  the  work.  Under  the  contractor  or 
the  public  superintendent  the  loafer  has  only  the  overseer 
to  look  out  for,  but  under  the  co-operative  system  every  one 
of  his  associates  is  an  overseer,  with  the  keenest  self-interest 
in  seeing  that  every  one  of  the  group  does  his  full  share  of 
the  common  task. 

There  are  "privileged  classes"  among  the  men  who  are 
thus  employed — men  who  have  never  before  been  on  pub- 
lic work,  men  who  are  residents  of  the  district  where 
the  work  is  to  be  done,  married  men,  men  who  have  been 
longest  out  of  work — these  take  precedence.  If  there  are 
more  men  than  are  needed,  the  choice  is  made  by  ballot  in- 
stead of  "pull,"  and  the  men  superintend  the  ballot  them- 
selves. 

The  men  who  are  seen  in  the  co-operative  groups  are 
the  men  for  whom  the  Improved  Farm  Settlements  have 
been  devised.  It  will  be  told  later  how  their  families  are 
brought  with  them  if  desirable,  or,  if  not,  how  the  savings 
of  the  head  of  the  family  are  remitted  to  his  dependents 
and  how  they  are  helped  to  farms  and  encouraged  to  work 
them.  To  all  this  is  to  be  added  the  advances  to  settlers 
and  the  bonuses,  instruction,  and  the  other  assistance  given 
to  their  production  by  the  People  forming  with  them  a  part- 


ioo  WORKMEN  CONTRACTORS 

nership,  "Government  &  Co.,  Unlimited,"  especially  if  their 
products  can  be  branded  "Approved  for  Export"  and  sent  to 
England  to  add  to  the  funds  available  for  the  payment  of 
the  indebtedness  of  the  colonies  to  England. 

So  far  as  the  partnership  of  the  men  is  concerned,  these 
co-operative  groups  much  resemble  the  "butty  gangs"  of 
the  miners  and  other  workingmen  known  to  all  familiar 
with  the  north  of  England.  The  public  works  officials  of 
New  South  Wales  claim  that  they  had  introduced  the 
"butty  gang"  into  their  operations  even  before  New  Zea- 
land had  domesticated  it  as  the  "co-operative  group,"  and 
that  it  is  still  largely  used  by  the  Department  of  Public 
Works.  The  co-operative  principle  was  introduced  in  1891 
into  Victoria,  in  imitation  of  New  Zealand,  but  neither  there 
nor  in  New  South  Wales  is  it  a  part  of  that  broad  system 
of  settlement  on  the  land  and  the  conversion  of  penniless 
and  workless  men  into  householders,  property  owners,  and 
tax-paying  citizens,  with  a  stake  and  a  beefsteak  in  the 
country,  which  makes  the  New  Zealand  adaptation  of  the 
scheme  so  statesmanlike  and  remunerative. 

All  the  colonies  are  more  or  less  displacing  the  contract 
system  by  that  of  construction  by  the  government  itself 
with  its  own  workers,  and  this  is  a  step  toward  making  the 
men  contractors,  for  it  involves  the  abolition  of  the  middle- 
man. A  select  committee  of  the  New  South  Wales  Parlia- 
ment in  1897  investigated  the  results  there  of  having  rail- 
way and  other  work  done  without  contractors.  In  its 
report  the  committee  says  that  the  work  done  by  day  labour 
is  as  well  done  as  similar  work  under  the  contract  system. 
The  cost  has  not  been  increased,  and  in  some  cases  has  been 
materially  less,  while  the  danger  of  litigation,  an  item  of 
considerable  importance,  has  been  entirely  abolished.  The 
railway  authorities  and  the  travelling  public  have  both  been 
convenienced  by  the  greater  safety  for  travellers  and  greater 


STATE  CLOTHING  FACTORY  101 

celerity  in  execution  of  work,  which  comes  from  the  fact  that 
the  commissioners  are  able  to  keep  everything  under  their 
control.  The  committee  therefore  resolve  that  this  method 
of  work  is  in  the  public  interest  and  recommend  that  it  be 
further  extended. 

New  South  Wales  is  planning  another  incursion  into  the 
field  of  the  contractor  and  sweater.  I  found  the  Secretary 
of  the  Public  Service  board,  Mr.  T.  A.  Coghlan,  prepar- 
ing plans  for  a  clothing  factory  for  the  uniforms  of  its 
men.  The  government  will  take  one  of  its  buildings  on 
the  quay  at  Sydney  for  the  enterprise.  When  it  is  once 
in  successful  operation,  the  railway  department,  the  post- 
office,  the  army,  and  many  other  institutions,  like  the  asy- 
lums and  hospitals,  will  make  their  contracts  for  uniforms 
here,  and  another  province  will  be  lost  to  "the  competitive 
system." 

The  Contractors'  Association  in  New  South  Wales,  when 
I  was  there,  resolved  at  one  of  its  meetings  that  they  would 
combine  to  get  a  member  of  Parliament  to  represent  them 
in  their  opposition  to  the  continuance  of  the  "direct  employ- 
ment" policy. 

These  co-operative  works  in  New  Zealand,  wholly  a  cre- 
ation of  the  Liberal  party,  have  of  course  been  bitterly  criti- 
cised by  the  Opposition.  The  former  Minister  of  Lands 
under  the  Conservatives  avowed  himself  in  Parliament  op- 
posed to  them  in  toto,  and  declared  that  "under  this  co-op- 
erative business  we  have  to  pay  much  more  with  very  poor 
results  than  under  the  contract  system."  Another  leader  of 
the  Opposition  described  the  expenditure  under  it  as  a  "huge 
bribery  fund  used  for  political  purposes."  One  of  the  cam- 
paign devices  of  the  Conservatives  in  the  election  of  1899 
was  the  scattering  of  circulars  on  the  highways  before  the 
election  denouncing  the  co-operative  system  in  the  interest 
of  workmen,  and  calling  on  them  to  vote  for  the  party  which 


102  WORKMEN   CONTRACTORS 

would  abolish  it.  The  Premier,  the  Honourable  Richard 
J.  Seddon,  declared  in  his  campaign  speeches  that  he  would 
stand  by  co-operative  work  as  long  as  he  remained  in  New 
Zealand'. 

In  the  last  session  of  Parliament — 1899 — the  Minister 
for  Public  Works,  the  Honourable  William  Hall-Jones,  an- 
nounced that  so  far  from  intending  to  abandon  the  system, 
as  had  been  charged  by  the  Opposition,  the  department  was 
extending  it,  and  continued  to  find  that  the  results  compared 
favourably  with  those  of  the  contractor  system.  If  there 
is  anything  in  public  administration  that  the  people  are  more 
familiar  with  than  another,  it  must  be  work  of  this  kind, 
which  is  done  in  the  open,  on  the  roads,  bridges  and  public 
buildings,  which  the  people  pass  every  day.  The  over- 
whelming and  unprecedented  victory  of  the  Liberals  showed 
that  these  criticisms  made  no  impression  on  the  con- 
stituencies. 

In  referring  to  the  operation  of  Sir  Julius  Vogel's  scheme 
of  public  works,  under  which  ten  millions  of  pounds  were 
borrowed  in  1870  to  build  railroads  and  assist  immigration, 
Premier  Ballance  said :  "The  great  public  works  policy  was 
built  on  a  false  foundation,  for  it  was  not  built  on  the  in- 
dustries of  the  people."  This  co-operative  work  system  is 
built  directly  on  the  industries  of  the  people. 

An  influential  member  of  the  Unemployed  Advisory 
Board  of  New  South  Wales,  the  Venerable  Archdeacon 
Langley,  in  a  report  of  labour  conditions  in  New  Zealand, 
which  he  made  in  1899  to  the  board  as  a  result  of  a  visit  of 
investigation,  credits  the  co-operative  contract  system  with 
the  fact  that  since  its  adoption  eight  years  ago  there  has 
been  no  unemployed  agitation  in  New  Zealand.  He  quotes 
from  a  leading  dignitary  of  the  Church  of  England  in  New 
Zealand  the  opinion  that  though  the  co-operative  works  are 
more  costly  than  the  old  contract  system,  they  save  all  this 


NO   UNEMPLOYED   AGITATION  103 

extra  cost  and  more  by  the  absorption  of  the  unemployed 
and  by  the  rescue  of  the  men  and  their  families  from  pau- 
perism. 

We  do  not  usually  feel  it  to  be  necessary  to  be  greatly 
impressed  by  eloquent  phrases  in  official  literature  about  the 
"dignity  of  labour"  or  the  "interests  of  the  people."  These 
have  been  the  cloak  of  selfish  exploitation  in  all  ages, 
whether  of  kings  or  parties.  But  we  must  acknowledge 
that  its  deeds  entitle  its  words  to  our  respect,  when  the  New 
Zealand  government  in  its  description  of  this  system,  says, 
"The  co-operative  system  places  the  workman  on  a  much 
higher  plane  and  enables  him  to  comprehend  more  fully  the 
dignity  of  labour.  Under  the  co-operative  system  every 
workman  is  a  contractor  and  has  a  personal  interest  in  the 
economical  and  the  successful  carrying  out  of  the  work. 
He  is  also  his  own  master." 


CHAPTER  VI 

TAXATION    TO    BURST    UP    MONOPOLIES 

"THE  great  curse  of  New  Zealand,"  declared  one  of  the 
members  of  the  reform  Parliament  of  1891,  "is  the  variety 
of  its  monopolies."  There  were  monopolies  in  earth,  fire 
and  water,  since  there  was  a  shipping  ring,  and  one  in  coal, 
and  there  was  monopoly  in  money  and  in  other  things. 
The  incredible  extent  of  that  in  land  is  shown  in  another 
chapter.  In  1891  there  were  sixteen  hundred  persons  who 
held  eighteen  million  acres  of  land ;  eleven  men  owned  land 
worth  twenty- four  millions  of  dollars;  one  hundred  and 
seven  owned  land  of  the  value  of  thirty-five  millions  of 
dollars. 

Would-be  settlers,  in  search  of  homes  and  farms,  would 
pass,  here,  a  tract  of  seventy-five  thousand  acres  of  the  best 
of  land,  with  a  population  of  only  twenty-nine  men,  women 
and  children;  and,  there,  another  of  two  hundred  and  fifty 
thousand  acres  of  good  land,  with  only  sixty-five  people. 
They  also  saw,  as  they  went  about,  railroads,  wharves,  high- 
ways and  bridges,  made  in  large  tracts  of  waste  land. 
Where  the  least  population  was,  the  national  and  local  au- 
thorities of  the  old  regime  had  spent  vast  sums  for  these 
works,  under  the  instigation  of  landlords  not  "looking  back- 
ward," like  Mr.  Bellamy,  but  looking  forward  to  more  and 
more  unearned  increments.  A  railroad  was  sometimes  built 
at  the  public  expense  simply  to  bring  the  wool  of  one  great 
estate  to  market. 

104 


TAXES   AS   REFORMERS  105 

The  Maori  war  debt  of  several  millions  represented  also 
money  expended  to  get  more  land  for  the  monopolists.  The 
cost  of  these  wars  and  works  had  to  be  borne,  through  the 
tariff,  by  the  masses  of  consumers,  and,  through  the  property 
tax,  by  the  masses  of  producers;  always  the  masses — the 
carriers  always  of  the  "white  man's  burden." 

The  great  fortunes  of  New  Zealand  grew  out  of  the  in- 
creased value  given  to  the  land  of  the  few  by  the  labour, 
taxation,  borrowed  money  and  public  works  of  the  people; 
and  these  few  men  contrived  the  property  tax,  falling 
mainly  on  improvements,  and  escaped  their  fair  share  of  the 
public  burden,  as  their  land  was  largely  unimproved. 

"Every  one  knows,"  said  Mr.  Seddon  in  Parliament,  "that 
the  curse  of  this  country  is  the  companies  holding  large  es- 
tates ;  these  estates  are  increasing ;  the  companies  do  not  die, 
and  there  is  no  provision  to  compel  subdivision." 

"The  first  plank  in  the  Liberal  platform,"  said  Premier 
Ballance  in  1891,  "must  be  the  land  question." 

Land  monopoly  was  to  be  the  first  to  be  attacked,  and  the 
first  means  of  attacking  it  was  that  ancient,  constitutional 
and  inalienable  weapon — the  tax. 

Accordingly,  Mr.  Ballance  put  forward  the  taxation  of 
land  and  incomes  as  the  first  measure  of  his  programme; 
and  both  of  these  taxes  were  made  progressive — growing 
heavier  as  the  taxee  grew  richer. 

This  was  put  before  tariff  readjustment,  or  labour  laws, 
or  compulsory  arbitration,  or  the  resumption  of  estates  for 
settlement,  or  state  banking,  or  any  of  the  other  reforms  in 
which  notable  work  has  since  been  done.  There  was  a  triple 
purpose — fiscal  and  social — to  be  achieved  by  the  new  taxes. 
First,  revenue;  second,  to  make  the  landowners  pay  their 
share  of  the  cost  of  government  and  of  the  public  works, 
which  had  made  them  rich,  and  third,  to  break  up  the  mo- 
nopolies. 


106  TAXES   AS   REFORMERS 

The  Premier  was  explicit:  "The  graduation  of  the  taxes 
is  to  check  monopoly."  He  did  not  shrink  from  raising  the 
issue  between  the  rich  and  the  poor.  "It  is  for  the  people 
to  say  whether  the  land  out  of  which  all  must  live  shall  be 
widely  distributed,  or  whether  it  shall  be  held  by  a  privileged 
number.  Our  policy  raises  the  issue  in  the  most  practical 
form." 

In  closing  the  debate  he  said,  "I  care  little  for  the  mere 
capitalist.  I  care  not  if  dozens  of  large  landowners  leave 
the  country.  For  the  prosperity  of  the  colony  does  not  de- 
pend on  this  class.  It  depends  upon  ourselves,  upon  the 
rise  of  our  industries  and  upon  markets  being  secured  in 
other  countries,  and  not  upon  any  such  fictitious  things  as 
whether  the  large  capitalists  remain  or  leave  the  colony. 
They  are  merely  accidents  of  the  situation.  They  are  often 
but  excrescences  which  afflict  our  industries." 

"We  propose,"  the  Minister  of  Labour,  the  Honourable 
William  Pember  Reeves,  afterward  author  of  the  Compul- 
sory Arbitration  Law,  said  in  the  same  debate,  "to  take  off 
taxation  from  the  small  land  proprietors  and  put  it  on  the 
large  owners." 

"Our  object,"  Mr.  Seddon  said,  "is  to  prevent  the  mass 
of  the  people  who  own  no  land  from  becoming  serfs."  He 
declared  that  "most  of  the  fortunes  that  have  been  made  in 
this  country  have  been  made  by  the  increased  value  given  to 
the  land,  week  after  week  and  year  after  year,  by  the  people 
of  this  colony,  and  not  by  any  exertion  or  any  brain  power 
on  the  part  of  those  that  hold  the  land." 

"The  new  legislation,"  a  labour  member  said,  "was  notice 
to  capital  for  the  first  time  in  its  history  that  it  is  no  longer 
an  autocrat." 

This  member  expressly  defended  the  progressive  feature 
of  the  proposed  taxation,  on  the  ground  that  it  gave  effect 
to  the  principle  "that  those  who  have  great  wealth  shall  bear 


THE  ONLY   NEW   ZEALAND   PEST        107 

a  far  greater  proportion  of  the  burden  of  taxation  than  they 
have  hitherto  borne.  Capitalists  will  have  to  realise  that  if 
they  fail  to  recognise  their  responsibilities  and  obligations  to 
their  fellowmen,  the  state  will  take  care,  by  a  progressive 
method  of  taxation,  to  make  them  do  so." 

He  declared  himself  willing  to  have  the  process  called 
"confiscation,"  "bursting-up,"  anything,  so  long  as  the  result 
was  achieved — that  the  land  should  be  divided  among  the 
people. 

The  Conservatives,  who  had  been  having  everything  their 
own  way  in  New  Zealand  for  so  many  years,  got  some  very 
plain  talk  from  the  representatives  of  the  people  in  the  new 
Parliament.  The  orators  of  the  French  Revolution  were 
not  plainer,  but  the  New  Zealand  methods  fortunately  were 
not  those  of  that  unhappy  episode. 

In  defending  the  heavier  taxes  to  be  imposed  on  the  larger 
estates,  Mr.  Reeves  said :  "The  large  estates  are  represented 
by  the  very  last  class  which  should  dare  call  upon  the  state 
for  consideration.  These  estates,  whether  partly  or  almost 
entirely  unimproved,  are  a  social  pest,  an  industrial  obstacle 
and  a  bar  to  progress.  The  party  we  represent  does  not 
want  large  estates,  and  this  graduated  tax  is  a  finger  of 
warning  held  up  to  remind  them  that  the  colony  does  not 
want  these  large  estates."  Mr.  Reeves  pointed  out  that  the 
public  works  policy  had  been  made  "lop-sided."  It  had 
built  railroads  and  assisted  immigration,  but  had  failed  to 
help  the  people  to  homes  and  livelihoods  on  the  land,  and 
this  was  directly  due  to  the  opposition  of  the  owners  of  the 
large  estates.  He  dwelt  on  "the  evil  these  large  estates  have 
been,  on  the  disappointed  hopes,  the  checked  progress,  the 
ruined  industries  and  the  broken  hearts  caused  by  the  de- 
pression of  the  colony  during  the  last  dozen  years."  New 
Zealand  had  seen  the  spectacle,  extraordinary  for  so  young  a 
country,  of  thousands  of  its  most  vigorous  people  going 


io8  TAXES   AS   REFORMERS 

abroad  in  search  of  work  and  land.  He  credited  this  exodus 
to  the  monopolists :  "Thousands  of  families  and  tens  of 
thousands  of  fellow  colonists  have  been  driven  over  the  sea, 
just  as  surely  as  the  people  of  Russia  are  driven  into  exile  by 
the  edict  of  the  Czar."  "It  is  not  to  ruin  them,"  he  said, 
"but  to  bring  home  to  these  gentlemen  that  they  have  done  a 
wrong  to  their  fellowmen,  that  we  propose  the  graduated 
tax  on  the  large  estates." 

To  prevent  Newest  England  from  sinking  into  the  con- 
dition of  the  Old  England  was  the  frankly  avowed  purpose 
of  the  new  taxes.  The  Premier,  in  proposing  the  graduated 
taxation  of  land  and  incomes,  quoted  what  he  impressively 
called  the  "appalling  facts"  of  the  pauperism  of  England, 
where  one  half  of  all  the  population  who  reach  the  age  of 
sixty-live  also  reach  the  poorhouse,  and  where  "in  Lon- 
don one  person  in  every  five  dies  in  the  workhouse,  hospital 
or  lunatic  asylum." 

"Well,"  he  exclaimed,  "may  we  question  the  economic  and 
social  system  of  which  this  is  the  product!" 

He  called  on  Parliament  by  the  adoption  of  these  meas- 
ures to  take  a  step  toward  "establishing  our  civilisation  in 
this  new  land  on  a  broader  basis  in  a  deeper  sympathy  for 
humanity." 

His  closing  words  were,  "Nor  need  we  fear  that  in  pur- 
suing this  we  shall  fail  to  reap  that  material  prosperity  at 
which  financial  systems  aim.  The  wide  diffusion  of  wealth 
and  industry  among  the  people  is  the  surest  guarantee  of 
a  buoyant  revenue  and  wealthy  exchequer.  I  see  only 
the  closest  relationship  between  a  people  well-placed  and 
fully  employed  and  a  state  enjoying  the  highest  credit  and 
discharging  every  obligation,  moral  and  legal,  imposed 
upon  it." 

No  scientific  student  of  the  land,  labour  and  fiscal  insti- 
tutions of  New  Zealand  could  omit  an  examination  like  this 


THIS    IS    SCIENTIFIC  109 

of  the  economic  pressure  that  produced  them,  and  of  the 
opinions  and  sentiments  which  this  pressure  had  developed 
among  the  people. 

Laws  are  but  the  statutory  phrasing  of  the  ideas  of  self- 
interest  of  those  who  enact  them;  and  as  the  laws  are  too 
often  an  inadequate  expression  of  these  ideas,  such  senti- 
ments and  opinions  as  are  revealed  in  this  presentation  of 
the  state  of  mind  of  the  New  Zealand  democracy  is  really  of 
as  much  moment  to  the  scientific  student  of  the  institutions 
as  the  institutions  themselves,  perhaps  of  more. 

The  people  saw  their  exploiters  using  the  familiar  instru- 
ments of  government,  and  had  the  wit  to  see  that  to  turn  the 
same  instruments  against  the  exploiters  was  what  was 
needed,  not  a  wholesale  construction  and  reconstruction  of 
society. 

Taxation  had  been  one  of  the  most  effective  of  these  in- 
strumentalities of  the  monopolists,  especially  the  "property 
tax."  The  people  therefore  demanded  first,  the  repeal  of 
this  tax;  and  second,  and  most  important,  the  substitution 
for  it  of  a  tax  which  should  bear  specifically  on  the  monopo- 
lies. This  property  tax,  like  that  still  in  vogue  in  many  of 
the  commonwealths  of  the  United  States,  had  become  ex- 
ceedingly unpopular,  and  its  abolition  was  made  one  of  the 
chief  issues  of  politics. 

The  farmers,  especially,  were  against  this  property  tax. 
They  grew  infuriated  at  seeing  that,  as  they  acquired  more 
land,  built  more  barns,  added  to  their  stock,  and,  through  the 
taxes  they  paid,  opened  roads  and  improved  the  country, 
their  taxes  were  increased,  while  the  owners  of  unimproved 
great  estates  next  to  them,  rising  rapidly  in  value,  paid  no 
more  and  sometimes  less,  and  year  by  year  bought  out  their 
overburdened  neighbours. 

In  the  campaign  of  1890  the  discriminations  of  the  prop- 
erty tax  were  the  subject  of  discussion  on  every  platform  in 


no  TAXES   AS   REFORMERS 

the  colony.  It  was  shown  to  be  crude  and  oppressive.  It 
taxed  men  who  were  losing  money  as  much  as  those  who 
were  making  a  profit,  and,  so,  taxed  misfortune.  Enter- 
prise and  energy  were  dampened  by  a  system  which  made  a 
man  pay  as  much  when  he  was  running  behind  as  when  he 
was  going  ahead.  It  taxed  not  only  industry,  but  the  ma- 
terials of  industry.  The  professional  men  whose  property 
was  in  their  earning  power  escaped,  while  the  poor  settler 
was  fined  a  large  slice  of  his  income  to  pay  for  their  share 
of  the  government  and  his  own.  In  taxing  unprofitable  prop- 
erty and  unsold  goods,  it  preyed  with  especial  severity  on  the 
small  traders  and  the  small  farmers,  and  made  the  owner 
pay,  over  and  over  again,  on  that  which  paid  him  nothing. 

For  the  men  who  \vere  heavily  in  debt  but  had  to  pay  on 
the  full  value  of  the  property  that  stood  in  their  name,  not- 
withstanding the  mortgage,  the  property  tax  was  confisca- 
tory.  It  discouraged  improvements.  It  took  out  of  circu- 
lation the  money  that  was  needed  in  business.  It  was  a 
direct  tax  on  labour.  It  was  unjust,  inquisitorial  and  un- 
certain. It  crippled  the  mining  industry  in  many  districts 
by  its  annual  demand  for  tribute  from  capital  that  was  un- 
productive. It  discouraged  enterprise  by  putting  a  tax  on 
new  industries  before  they  had  begun  to  yield  return. 

The  tax  was  almost  ruinous  in  its  exactions  on  the  owners 
of  property  with  small  incomes.  Business  men  or  farmers 
who  ventured  money  on  experimental  improvements  had  to 
pay  the  property  tax  on  the  money  invested,  though  the  ex- 
periments were  often  failures  and  the  money  hopelessly 
sunk. 

But  it  was  the  poor  settler  who  was  the  heaviest  sufferer. 
There  was  an  outcry  from  the  small  people  from  end  to 
end  of  the  country.  They  toiled  and  struggled  to  improve 
their  small  properties,  and  the  moment  the  improvements 
were  made,  clown  came  the  property  tax  commissioner.  "I 


A   LITTLE   BILL    WILL   DO    IT  in 

have  seen,"  said  a  member  in  Parliament,  "over  and  over 
again  a  man  and  his  wife  take  up  some  small  section  and  put 
up  frame  buildings  and  carry  out  other  improvements.  The 
land  previously  liable  to  a  tax  of  only  one  pound  in  its  un- 
improved state  now  became  liable  to  an  amount  of  four 
pounds  and  over.  At  the  same  time  some  one  alongside, 
who  had  merely  bought  his  land  for  speculative  purposes 
and  allowed  it  to  become  a  rabbit  warren  and  a  nuisance  to 
his  neighbours,  finds  his  taxation  lower  simply  because  they 
had  improved  their  land." 

On  these  lines  the  policy  of  the  property  tax  was  threshed 
out  from  one  end  of  New  Zealand  to  the  other  in  the  cam- 
paign, and  when  the  election  was  held,  the  tax  was  buried 
forever. 

The  New  Zealanders  did  not  dream  of  tearing  the  house 
down  because  they  woke  up  to  find  it  full  of  embezzlers  or 
burglars.  They  proceeded  to  put  the  intruders  out,  and 
their  economic  common-sense  saw  that  for  the  kind  of  burg- 
lars and  embezzlers  that  we  call  monopolists  there  is  no 
ejector  equal  to  the  inalienable  and  irresistible  power  of  tax- 
ation which  the  monopolists  cannot  withstand  and  which 
the  state  can  never  lose. 

"There  is  no  contract,  expressed  or  implied,"  Premier 
Ballance  said,  "which  would  be  superior  to  the  safety  of  the 
people.  The  safety  of  the  people  is  the  supreme  law." 

I  found  it  universally  avowed  in  New  Zealand  that  the 
present  taxes  are  only  the  beginning.  There  is  no  point  of 
policy  for  the  future  more  firmly  fixed  in  the  popular  mind 
than  that  these  taxes  shall  be  increased  until  they  have  done 
the  work  for  which  the  reform  was  begun. 

"It  is  the  thin  edge  of  the  wedge,"  one  of  the  ministers 
said  to  me.  "We  had  to  get  that  in  first.  It  will  be  easy 
enough  to  increase  the  taxes  on  land  and  incomes.  A  little 
bill  of  a  very  few  lines  will  do  that." 


ii2  TAXES  AS   REFORMERS 

"One  of  the  most  effective  features  of  these  taxes,"  an- 
other high  official  said,  "is  not  that  they  are  heavy,  for  they 
are  very  light,  but  that  they  can  be  so  easily  made  heavy  by 
a  few  words  of  legislation." 

The  present  Premier,  Mr.  Seddon,  is  never  at  a  loss  when 
challenged  to  show  where  he  can  find  the  revenue  necessary 
to  maintain  his  old-age  pensions  or  to  institute  some  of  the 
other  reforms  he  meditates.  He  keeps  constantly  in  the 
cheerful  view  of  the  people  the  availability  of  higher  taxation 
of  the  larger  estates  and  the  larger  incomes. 

The  new  taxes  were  riot  put  forward  as  ideal  nor  perfect. 
"Such  a  thing  as  an  absolutely  fair  tax  has  never  been  con- 
ceived by  the  mind  of  man,"  Mr.  Ballance  said,  but  he 
offered  his  tax  law  as  a  great  advance  on  what  had  gone 
before.  There  are  six  special  features  in  the  new  taxation : 

Land  and  incomes,  especially  those  of  corporations,  are 
taxed  for  national  purposes. 

This  taxation  is  progressive,  and  heaviest  for  the  richest. 

Improvements  are  exempt. 

Small  estates  and  small  incomes  are  not  to  be  taxed. 

Mortgages  are  deducted  from  the  property  of  the  small 
taxpayers. 

Absentees  are  penalised. 

The  exemption  of  improvements,  and  the  exemption  of 
the  small  men  are  cardinal  features.  No  landowner  with 
property  worth  less  than  $2500  clear  pays  any  national  tax 
on  his  land  in  New  Zealand. 

This  exemption  is  planned  expressly  to  favour  the  small 
men — "the  struggling  poor  men" — as  I  heard  the  Commis- 
sioner of  Taxes  say,  and  this  is  avowed  by  the  government 
in  its  publications. 

Exemption  has  another  purpose — to  encourage  the  rich 
man  to  employ  labour  and  improve  his  estate  if  he  holds  it; 
if  not,  the  progressive  tax  encourages  him  to  sell. 


A   MERCIFUL   TAX   GATHERER  113 

"By  taxing  land,"  Premier  Seddon  says,  "owners  are 
compelled  to  take  out  of  the  land  what  there  is  in  it — its  fer- 
tility, power  to  support  population.  'There  it  is,'  we  say, 
'take  it  out.'  They  have  to  build  houses  and  fences  and  to 
cultivate;  to  employ  smiths,  masons,  carpenters,  and  circu- 
late their  money." 

The  new  legislation  was  cautious.  Improvements,  for 
instance,  were  in  the  first  law  not  wholly  exempt,  although 
the  popular  party  were  pledged  to  their  complete  exemption. 
Only  fifteen  thousand  dollars'  worth  of  improvements  were 
exempt  by  the  law  of  1891.  The  treasury  had  to  be  con- 
sidered, and  it  was  not  until  it  was  found  that  the  revenue 
would  permit  it  that  full  exemption  was  given. 

As  mortgages  are  in  part  on  the  security  of  the  land,  the 
exemption  of  the  mortgage  is  an  additional  exemption  from 
the  land-tax.  Owners  of  land  worth  less  than  $25,000  are 
allowed  to  deduct  any  mortgages  they  owe  from  their  valu- 
ation. To  be  the  owner  of  property  worth  more  than 
twenty-five  thousand  is  to  be  doubly  penalised.  Such  a 
one  has  to  pay  the  graduated  land-tax,  and  gets  no  deduction 
for  his  mortgages. 

The  third  exemption  is  of  small  properties.  That  is, 
after  the  improvements  and  the  mortgages  have  been  de- 
ducted, there  is,  if  there  is  not  more  than  $7500  left,  a  still 
further  deduction  of  $2500  allowed.  This  exempt  amount 
decreases  gradually  when  the  valuation,  less  improvements 
and  mortgages,  rises  above  $7500  and  until  $12,500  is 
reached.  At  that  point,  $12,500,  it  ceases. 

The  democracy  in  New  Zealand  is  a  humanitarian  tax- 
gatherer.  If  an  old  or  infirm  person  owns  land  or  mort- 
gages returning  less  than  £200,  $1000,  a  year,  and  he  can 
show  that  he  is  unable  to  supplement  this  slender  income, 
and  that  the  payment  of  the  tax  would  entail  hardship,  the 
commissioner  may  remit  the  tax. 


ii4  TAXES   AS   REFORMERS 

The  capital  invested  in  the  mortgage  does  not  escape  tax- 
ation, but  it  is  taxed  in  the  hands  of  the  lender,  for  he  must 
pay  tax  on  his  mortgages  as  if  they  were  land. 

The  amount  deducted  for  improvements  is  "the  inex- 
hausted  value,"  that  is,  the  value  still  remaining.  Tax- 
payers' human  nature  is  the  same  in  New  Zealand  as  else- 
where. When  the  improvements  were  taxable  under  the 
late  property  tax,  no  taxpayer  could  see  any  value  in  his 
improvements  to  speak  of ;  but  now  that  what  they  are  worth 
can  be  deducted  from  the  property  to  be  taxed,  the  appre- 
ciation which  taxpayers  show  of  them  excites  the  wonder 
of  the  Commissioner  of  Taxes. 

Improvements  are  not  entirely  free  from  taxation,  for  the 
tax  on  mortgages  is  of  course  a  tax  on  improvements  as  well 
as  on  the  land.  The  mortgage  tax  is  also  a  tax  on  the  bor- 
rower, since  the  lender  not  only  makes  the  borrowers  pay  the 
tax,  but  makes  them  pay  him  a  profit  for  handling  it.  The 
Commissioner  of  Taxes  thinks  that  this  adds  one  half  of  one 
per  cent,  to  the  rate  of  interest. 

Professor  Seligman  is  certainly  right  when  he  says  in 
his  "Essays  on  Taxation"  that  the  exemption  of  improve- 
ments in  New  Zealand  favours  the  city  owner  of  real  estate. 
The  improvements  are  a  much  larger  proportion  of  the  total 
value  of  landed  property  in  the  city  than  in  the  country. 
The  capitalist  who  has  expensive  tenements  or  warehouses 
or  productive  property  unencumbered,  pays  no  land-tax  on 
the  money  invested  in  the  buildings.  He  pays  only  on  the 
"prairie  value"  on  his  lot. 

The  taxation  of  mortgages  also  favours  the  unencumbered 
man  and  increases  the  burden  of  the  man  who  has  had  to 
borrow.  He  who  is  free  of  debt  is  free  of  taxes  on  his  im- 
provements, but  not  so  the  man  who  owes  on  a  mortgage 
and  on  whom  the  money-lender  throws  the  burden  of  the 
tax  in  higher  interest. 


HOW   EXEMPTION   WORKS  115 

Farm  tenants  pay  no  income  tax  on  profits  derived  from 
the  land.  They  pay  no  land-tax,  for  that  is  paid  by  the 
owner  of  the  land.  They  feel  the  tax  only  in  the  rent. 

As  the  government  is  an  extensive  lender  to  landowners 
in  advances  to  settlers,  it  very  properly  and  shrewdly  stip- 
ulates that  valuations  made  for  lands  shall  also  be  valuations 
for  taxation.  The  citizen's  property  is  not  to  be  considered 
worth  more  to  borrow  on  from  the  government  than  to  pay 
taxes  on. 

There  was  a  provision  in  the  law  as  passed  at  first,  but 
since  lapsed,  that  the  government  could  take  the  property 
of  any  taxpayer  at  the  valuation  he  had  put  upon  it,  plus  ten 
per  cent.,  if  he  objected  to  the  figure  at  which  the  govern- 
ment proposed  to  tax  it.  It  was  under  this  provision  the 
Cheviot  estate  was  taken,  as  we  tell  later. 

The  Land  and  Income  Tax  Commissioner,  Mr.  John  Mc- 
Gowan,  drew  up  for  me  the  following  schedule  illustrating 
how  the  exemption  of  improvements,  mortgages  and  small 
properties  operates: 

On  land  worth  say $25,000 

With  improvements  of $10,000 

The  unimproved  value  would  be 15,000 

The  land,  including  improvements  is  mortgaged  for  15,000 
The  amount  taxed 00,000 

Where  the  land  is  worth $35,000 

And  the  improvements 15,000 

And  the  unimproved  value  is $20,000 

And  the  land  and  improvements  are  mortgaged  for.    12,500 

The  net  value  is 7>5°° 

And  the  exemption 2,500 

A  taxable  value  is  left  of $5,000 

And  on  this  the  tax  is $21 


ii6  TAXES   AS   REFORMERS 

A  large  number  of  landowners  pay  no  tax  at  all.  Some- 
thing like  eight  thousand  to  ten  thousand  of  the  small  far- 
mers out  of  sixteen  thousand  have  been  relieved  of  taxation 
by  the  change  from  the  property  tax  to  the  land  and  income 
tax  and  pay  nothing.  Out  of  ninety  thousand  landowners 
only  thirteen  thousand  pay  land-tax. 

"The  land-tax  is  expressly  planned,"  the  Commissioner 
of  Taxes  said,  "to  exempt  the  small  owner  and  to  free  the 
struggling  poor  man." 

The  land-tax  begins  to  be  progressive  or  graduated  when 
the  values  reach  $25,000  above  improvements.  There  is 
no  tax  on  improvements,  large  or  small,  but  the  privilege 
of  exemption  of  mortgages  is  withdrawn  when  estates  are 
large  enough  to  be  subject  to  the  graduated  tax,  that  is,  at 
$25,000. 

The  larger  owner  not  only  pays  a  larger  rate  of  tax,  but 
loses  all  the  exemptions,  except  those  for  improvements. 
The  extra  tax  increases  by  one-eighth  of  a  penny  up  to  a 
value  of  $1,150,000,  when  its  maximum  is  reached  of  two- 
pence in  the  pound,  or  four  cents  in  every  $4.86.  This 
added  to  the  original  tax  of  one  penny  in  the  pound  makes  a 
maximum  possible  tax  of  threepence,  or  six  cents  on  $4.86 
of  value,  or  about  .013.  So  that  the  land-tax  even  at  its 
heaviest,  is  not  heavy.  The  purpose  was  sweeping,  but  the 
execution  has  been  most  gentle.  The  taxes  are  not  destruc- 
tive; great  estates  still  exist.  The  worst  that  can  be  said 
is  that  notice  has  been  served  on  the  monopolists  that  they 
must  surrender  or  disappear. 

Another  graduated  tax  is  that  on  estates  which  pass  by 
death.  Nothing  is  demanded  of  properties  worth  less  than 
$500,  nor  on  estates  that  descend  to  widows  and  widowers. 

The  rate  up  to  properties  worth  $5000  is  two  and  one 
half  per  cent.  It  then  rises  to  three  and  one  half  per  cent., 
until  a  limit  of  $25,000  is  reached,  when  it  becomes  seven  per 


WINGLESS    CAPITALISTS  117 

cent,  up  to  $100,000.  On  all  estates  above  that,  the  rate  is 
ten  per  cent. 

On  the  passage  of  the  new  taxation  laws,  some  of  the 
"sentimental"  capitalists  undertook  to  carry  out  their  threat 
of  "leaving  the  country,"  to  the  extent  of  refusing  to  lend. 
They  said  to  borrowers  who  sought  to  renew  mortgages, 
"You  have  elected  these  labour  men,  go  to  them  for  your 
money." 

The  only  result  was  that  they  lost  their  business,  for  there 
were  others  with  money  to  lend  who  were  glad  to  get  the 
securities.  The  only  persons  who  were  punished  were  the 
wingless  capitalists  themselves. 

Owners  of  estates  large  enough  for  the  graduated  tax 
have  a  further  penalty  if  absentees :  then  their  graduated  tax 
is  increased  twenty  per  cent.  The  collections  under  this 
head  are  very  small.  Some  of  the  absentees  escape  this  tax 
by  periodically  returning  to  the  colony. 

The  absentee  tax  was  not  an  invention  of  New  Zealand. 
In  England  two  hundred  years  ago,  it  was  enacted  that  "ab- 
sentees are  to  be  assessed  a  double  portion  on  their  lands, 
stocks  and  chattels."  And  even  in  Ireland,  in  the  reign 
of  Queen  Anne,  an  absentee  tax  of  six  shillings  in  the  pound 
was  put  on  all  office  holders  who  did  not  live  half  of  the 
year  in  the  country.  Times  have  changed,  and  in  Ireland 
now  the  absentees  are  not  taxed — they  tax. 

The  land-tax  yields  $1,075,000  a  year  and  the  graduated 
tax  and  the  absentee  tax  add  $450,000  more. 

The  income  tax  is  popular  because  it  taxes  only  the  profits 
of  industry,  and  not  the  materials  or  adventures  of  industry, 
and  because  it  taxes  men  on  their  improvements  and  experi- 
ments only  as  they  are  successful  and  only  in  proportion  to 
their  success. 

It  is  popular  with  business  men  for  the  reason  well  stated 
by  the  Honourable  William  Pember  Reeves.  "It  is  an  in- 


ii8  TAXES   AS    REFORMERS 

surance  premium  which  the  business  man  pays  for  entire 
relief  from  taxation  when  he  is  not  in  a  position  to  pay 
taxes." 

South  Australia  had  preceded  New  Zealand  in  its  adop- 
tion of  an  income  tax,  and  its  success  there  made  it  impos- 
sible to  doubt  its  practicability. 

As  planned  in  New  Zealand,  the  tax  is  free  from  un- 
necessary publicity.  The  New  Zealand  income  tax  follows 
the  same  lines  of  policy  as  the  land-tax.  The  small  man  is 
exempt.  The  rates  increase  as  the  income  increases.  The 
man  who  has  an  income  of  only  $1500  a  year  pays  nothing, 
and  fifteen  hundred  is  deducted,  with  one  exception,  from 
all  incomes  before  the  tax  is  levied. 

To  encourage  thrift  life  insurance  premiums  up  to  $250 
are  also  exempt.  The  rate  of  the  tax  is  sixpence  on  the 
pound,  or  twelve  cents  on  $4.86,  up  to  five  thousand  a  year. 
On  all  above  that  the  rate  is  double,  one  shilling  on  the 
pound. 

The  exception  just  spoken  of  is  in  regard  to  companies. 
Corporations,  joint-stock  companies,  are  not  allowed  the 
$1500  exemption,  nor  are  they  given  a  low  rate.  They 
must  all  pay  at  the  rate  of  a  shilling  on  the  pound  on  all 
their  income. 

Absentees,  too,  are  punished  as  in  the  case  of  the  land- 
tax,  and  are  not  allowed  the  $1500  exemption. 

The  steamship  companies  and  other  owners  of  vessels 
doing  business  in  New  Zealand  ports,  though  not  resident 
there,  must  pay  income  tax  on  the  profits  of  their  business 
in  New  Zealand. 

The  introduction  of  a  new  system  of  taxation  is  always 
attended  with  embarrassments  and  disappointments;  but 
though  there  has  been  embarrassment  in  this  New  Zealand 
experiment,  as  was  inevitable,  there  has  not  been  disappoint- 
ment, and  the  revenues  of  the  country  have  been  increased. 


CUTTING   UP   LARGE   HOLDINGS          119 

The  income  tax  yields  $575,000  a  year.  This  looks  small 
to  the  American  accustomed  to  big  figures,  but  everything 
in  this  world  is  comparative.  The  substitution  for  the 
property  tax  of  the  income  tax  and  the  land-tax,  with  the 
exemptions  of  improvements,  mortgages,  etc.,  has  not  re- 
sulted, as  it  was  predicted  would  be  the  case,  in  a  disastrous 
shrinkage  of  revenue. 

In  explanation  of  the  small  amount  received  under  the 
income  tax,  it  is  to  be  remembered  that  no  income  from  land 
or  mortgages  or  "from  the  use  and  produce  of  land  enjoyed 
by  the  owner  or  occupier"  is  taxable  under  this  head.  The 
land-tax  takes  care  of  landed  property  and  mortgages. 

When  a  farmer  makes  a  good  thing  out  of  butter  or  stock 
of  his  own  production,  he  is  not  called  upon  to  pay  income 
tax,  and  on  the  same  principle,  the  man  who  sells  cattle  out 
of  his  own  herds  does  not  pay  income  tax  on  the  profits. 
But  if  the  same  man  cuts  it  up  into  meat  in  a  town  shop,  he 
must  pay  income  tax  on  that'business. 

If  a  man  is  a  dealer  in  stock  which  he  gets  from  others, 
he  must  pay  an  income  tax  on  his  profits,  but  if  he  sells  only 
the  cattle  raised  by  himself,  he  is  not  liable. 

The  receipts  of  the  land-tax  are  steadily  decreasing,  year 
by  year,  though  land  values  are  increasing.  Of  course, 
since  small  estates  are  exempt,  and  both  the  government  and 
private  owners  are  cutting  up  large  tracts  into  smaller  pieces, 
there  must  be  a  continual  withdrawal  of  land  from  taxation. 

The  farther  subdivision  is  carried,  the  greater  will  be  the 
loss  of  revenue.  The  tax  is  evaded,  too,  I  was  told,  to  some 
extent  by  dividing  property  of  taxable  size  among  the  mem- 
bers of  a  family  into  pieces  small  enough  to  be  exempt. 

Some  papers,  like  the  "New  Zealand  Times,"  recommend 
that  this  decrease  be  met  by  taxing  the  small  men ;  but  this 
backward,  not  to  say,  revolutionary  measure  has  few  friends. 

"To  increase  the  graduation,"  both  in  the  income  and  the 


120  TAXES   AS   REFORMERS 

land-tax,  is  the  remedy  that  seems  most  popular  among  the 
radicals.  They  point  out  that  the  colony  has  sold  altogether, 
for  less  than  $80,000,000,  15,000,000  acres  of  land  which 
are  now  worth  $420,000,000.  And  they  insist  that  this 
difference  in  value  could  have  been  saved  by  a  proper  sys- 
tem of  taxation  and  that  it  is  now  a  proper  subject  for  a 
heavier  levy. 

What  part  had  Henry  George  in  the  land-tax  reforms  of 
New  Zealand  ?  Though  obviously  not  a  single  tax  country 
New  Zealand  has  made  so  much  progress  in  the  direction  of 
taxing  land  that  the  influence  of  that  great  American  at  once 
suggests  itself.  I  found  Henry  George  everywhere  spoken 
of  with  the  greatest  admiration.  Premier  Ballance  quoted 
him  as  an  authority  for  one  of  the  details  of  his  land-tax 
scheme,  and  referred  to  him  as  the  "greatest  authority  on 
the  land  question,  who  has  revolutionised  public  opinion." 
Ballance  described  as  his  ideal  tax  a  tax  on  the  value  of 
land,  less  improvements.  "It  ts  our  intention  gradually  to 
lead  up  to  the  pure  land-tax." 

His  government  would  have  been  glad  to  exempt  mort- 
gages from  taxation,  as  they  understood  perfectly  well  that 
this  was  a  tax  on  improvements ;  but  for  fiscal  reasons  they 
were  unable  to  do  so.  "Our  land-tax,"  the  commissioner 
said,  "is  not  a  pure  land-tax,  because  we  feared  that  would 
not  raise  revenue  enough.  It  was  impossible  to  foretell  the 
fiscal  result.  The  mortgage  tax  was,  therefore,  made  a 
part  of  the  system  and  that  saved  the  revenue." 

Parliament  has  passed  a  law  authorising  towns  to  levy 
their  taxes — or  rates — on  the  unimproved  value  of  land, 
forcing  idle  property  into  use,  if  the  people  vote  to  do  so. 
But  the  public  opinion  in  favour  of  this  "single  tax"  is  so 
feeble  that  in  the  three  years  the  law  has  been  in  force, 
only  twenty  local  bodies,  none  important,  had  voted  on  the 
proposition.  Twelve  adopted  and  eight  rejected  it. 


HENRY  GEORGE  121 

From  this  it  is  evident  there  is  very  little  "pure  land-tax" 
enthusiasm  among  the  local  taxpayers.  As  for  the  national 
bias  in  favour  of  such  taxation,  it  dates  back  of  the  aposto- 
late  of  Henry  George  to  the  ministry  of  Sir  George  Grey, 
who,  in  1878,  introduced  the  land-tax  into  New  Zealand 
finance.  Only  one  collection  was  made,  and  in  the  next 
year  the  tax  was  repealed  and  the  favourite  of  the  monopo- 
lists, the  property  tax,  replaced  it. 

"New  Zealand,"  Sir  George  Grey  said,  thirteen  years  later, 
"was  thus  the  first  country  to  have  a  fair  land-tax.  It  was 
the  wonder  of  other  countries  at  the  time." 

South  Australia  adopted  this  land-tax  and  has  retained 
it,  but  allows  no  exemption.  "But  it  came  too  early  here," 
Sir  George  Grey  said.  "The  great  landowners  trembled. 
They  believed  it  was  putting  in  the  thin  edge  of  the  wedge." 
They  rallied  all  their  forces  and  Sir  George  Grey  was  pun- 
ished by  expulsion  from  office. 

"Years  of  suffering,"  Sir  George  Grey  said,  after  this 
revolt,  in  1890,  "have  taught  the  people  how  great  a  boon 
they  then  lost,  and  they  are  now  determined  once  more  to 
get  and  keep  forever  that  tax  for  which  almost  all  mankind 
from  one  end  of  the  earth  to  the  other,  are  now  longing." 

"Henry  George  was  not  in  it,"  the  Commissioner  of 
Taxes  said  emphatically  in  explaining  that  the  New  Zealand 
tax  was  born  before  Henry  George's  ideas  were  known,  and 
that  the  land-tax  now  in  force  was  not  a  "pure  land-tax." 

"Henry  George  had  little  influence,"  another  authority 
declared.  "He  frightened  us  by  the  confiscatory  features 
of  his  plan." 

Mr.  Ballance,  in  a  pamphlet  in  1887,  sa^»  "Henry  George 
would  not  pay  from  the  public  exchequer  for  the  economic 
errors  of  the  past,  but  would  make  the  individuals  who 
accepted  the  guarantee  of  the  state  a  victim  of  the  national 
wrong-doing.  To  state  the  doctrine  is  to  condemn  it." 


122  TAXES   AS   REFORMERS 

The  most  important  thing  about  the  land  and  income  tax- 
ation of  New  Zealand  is  its  spirit — its  purpose — to  work  to 
redress  the  social  balance  between  the  too  rich  and  the  too 
poor.  But  little  more,  however,  has  been  achieved  than  to 
point  the  way  and  take  the  first  step. 

In  the  simple  statement  that  New  Zealand  still  raises 
seventy-five  per  cent,  of  her  revenue  from  the  tariff,  that 
much  the  largest  part  of  this  customs  revenue  is  derived 
from  the  necessaries  of  life,  is  made  manifest  the  unpleasant 
truth  that  even  in  New  Zealand  the  people  are  taxed,  not 
according  to  their  ability  to  pay,  but  according  to  their  ne- 
cessities. 

The  basis  of  contribution  through  the  tariff  to  the  sup- 
port of  the  government  of  New  Zealand  is  the  amount  of 
tea,  kerosene,  sugar,  etc.,  which  a  family  must  consume,  not 
the  amount  of  wealth  which  is  conserved  and  increased  for 
it  by  the  state. 

The  class  which  gets  the  chief  benefit  of  the  government, 
and  the  class  which  makes  the  chief  contribution  to  the 
cost  are  not  the  same. 

There  have  been  some  reductions  of  the  duties  on  the 
necessaries  of  life,  but  they  have  not  been  large  enough  to 
affect  the  general  character  of  the  tariff  as  "the  white  man's 
burden." 

I  found  a  rising  demand  among  the  Progressive  Liberals 
for  a  change  in  this  policy.  With  the  election  of  1899  the 
Conservative  party,  which  has  so  fruitlessly  attempted  to 
stem  the  tide  of  liberalism,  has  practically  disappeared  for- 
ever. The  Liberal  party  enters  upon  the  task  of  adminis- 
tration for  its  fourth  inning  with  a  majority  of  thirty  in  a 
Parliament  of  seventy-four — fifty-two  to  twenty-two. 

Influential  papers  like  the  "Times"  of  Lyttleton  are  call- 
ing upon  the  ministry  to  use  its  overwhelming  power  to 
readjust  the  burdens  of  taxation  by  increasing  the  land  and 


THE   WHITE   MAN'S    BURDEN  123 

income  tax  and  lightening  the  tariff.  They  point  out  that 
the  land  and  income  tax  system  was  adopted  for  two  pur- 
poses which  have  not  yet  been  achieved.  First,  to  break  up 
monopolies,  especially  that  in  land;  and  second,  to  transfer 
the  main  burden  of  government  to  those  who  get  its  main 
benefits. 

These  principles  have  been  given  all  the  dignity  of  statu- 
tory initiation,  but  they  cannot  be  said  to  be  carried  out  by 
a  policy  which  collects  three  quarters  of  the  taxes  by  a 
method  which  throws  the  heaviest  part  of  the  expense  of 
the  state  on  the  poor. 

Special  protest  is  made  against  the  policy  of  spending  on 
public  works  money  raised  by  this  tariff.  An  average  of 
$2,000,000  a  year  of  the  general  revenue  is  appropriated  to 
railroads  and  the  like.  "These  amounts,"  Mr.  Henry  George 
Ell,  a  young  workingman  of  Christchurch,  leader  of  the 
Progressive  Liberals,  and  just  elected  to  Parliament,  says, 
"are  taken  from  the  masses  of  the  people  to  be  spent  on  rail- 
roads and  other  works  to  enhance  the  wealth  of  the  land- 
owners." 

The  consideration  that  is  shown  small  men  in  the  land-tax 
is  undone,  much  more  than  undone,  in  the  tariff. 

Mr.  Ell  is  going  about  showing  the  farmers  that  they 
would  be  much  better  off  if  they  could  exchange  the  favours 
of  the  land-tax  for  justice  in  the  tariff.  If  the  preferences 
given  the  rich  by  the  tariff  were  abolished,  these  small  far- 
mers would  save  so  much  that  they  could  lose  all  their  ex- 
emptions, pay  the  taxes  on  the  full  value  of  the  land  and  still 
have  money  left.  But  by  taking  out  of  the  poor  man's 
pocket  the  funds  for  the  public  works,  railroads  and  the  like, 
mainly  for  the  benefit  of  the  landowners,  the  state  is  con- 
stantly abstracting  large  sums  of  money  from  the  pockets  of 
the  masses  which  it  is  spending  against  their  interest  to  in- 
crease their  rents  and  the  cost  of  living. 


124  TAXES   AS   REFORMERS 

The  present  Premier,  the  Honourable  R.  J.  Seddon,  is  in 
sympathy  with  the  demand  for  this  democratisation  of  tax- 
ation. During  the  last  campaign,  in  1899,  he  told  the  Liber- 
als that  if  he  had  to  choose  between  the  introduction  of 
penny  postage  and  the  lowering  of  the  tariff,  he  would  take 
the  latter.  Postage  reform  would  cost  the  revenue  three 
hundred  thousand  dollars,  two  thirds  of  which  would  go  to 
the  people  in  the  cities,  and  among  them,  almost  wholly,  to 
the  business  class.  He  thought  it  more  important  that  the 
taxation  of  the  necessaries  of  life  through  the  tariff  should 
be  reduced  to  the  masses.  And  he  declares  himself  willing 
to  reduce  the  tariff  taxes  in  exchange  for  a  higher  land-tax. 

The  total  revenue  from  the  land  and  income  tax  is  only 
$3,329,340  a  year,  while  the  tariff  produces  $10,201,155. 
The  average  rate  of  the  tariff  is  twenty-five  per  cent,  and  the 
rates  on  the  necessaries  of  life  are  much  higher  than  the 
average.  Tea  is  forty  per  cent. ;  sugar,  thirty ;  rice,  forty- 
two;  salt,  forty-eight;  kerosene,  ninety.  The  largest  tax- 
payers are  spirits,  tea,  sugar,  tobacco,  kerosene,  currants. 
These  are  the  poor  man's  necessaries;  which  means  that  a 
man  pays  taxes  according  to  the  size  of  his  family ;  and  the 
poor  man  in  all  countries  is  the  family  man. 

Mr.  Ell  is  a  leader  in  the  agitation  for  a  lower  taxation 
on  life  and  a  higher  taxation  on  land.  Through  newspaper 
articles,  the  organisation  of  the  Progressive  Liberal  Asso- 
ciation of  Canterbury,  and  by  public  speeches  and  political 
campaigns,  he  is  waking  up  the  press  and  the  politicians  and 
the  people  to  the  fact  that  there  is  an  issue  here  which  will 
have  to  be  met. 

His  association  has  papered  New  Zealand  with  the  facts 
and  arguments  about  the  discriminations  against  the  masses 
inseparable  from  a  tariff  on  the  necessaries  of  life,  and  has 
made  a  household  word  of  the  famous  quotation  from  Pitt : 

"To  levy  a  direct  tax  of  seven  per  cent,  is  a  dangerous  ex- 


THEY   PAY   WITHOUT   KNOWING         125 

periment  in  a  free  country,  and  may  excite  revolt ;  but  there 
is  a  method  by  which  you  can  tax  the  last  rag  from  the  back 
and  the  last  bite  from  the  mouth  without  causing  a  murmur 
against  high  taxes,  and  that  is  to  tax  a  great  many  articles  of 
daily  use  and  necessity  so  indirectly  that  the  people  will  pay 
them  and  not  know  it.  Their  grumbling  then  will  be  of 
hard  times,  but  they  will  not  know  that  the  hard  times  are 
caused  by  taxation." 


CHAPTER  VII 

A    MAN    BETTER   THAN    A    SHEEP 

NEW  ZEALAND,  though  so  young,  has  tasted  of  land  monop- 
oly to  the  dregs,  and  has  not  liked  it.  "Earth  hunger" 
became  ravenous  early  in  that  beautiful  and  fertile  country. 
It  would  be  idle  to  tell  the  old  story,  told  in  all  countries, 
of  the  various  and  devious  ways  in  which  the  heritage  of 
the  people  was  legislated  away  and  stolen  away  in  New  Zea- 
land. Enough  to  say  that  when  the  people  came  to  them- 
selves in  the  civic  revival  of  1890  they  found  this  the  chief 
among  the  evils  demanding  remedy.  Large  areas  were  held 
by  the  few,  and  they  would  not  sell  and  would  not  culti- 
vate. Population  surged  up  against  stretches  of  fertile 
plain  and  valley,  only  to  find  these  kept  out  of  the  market 
to  exact  a  suffocation  price  when  the  population  became 
more  crowded.  They  were  used  meanwhile  only  for  sheep. 
New  Zealanders  are  fond  of  sheep,  and  one  of  their  great- 
est staples  is  frozen  mutton,  but  they  finally  made  up  their 
minds  to  give  men  the  preference. 

Sir  George  Grey,  as  proud  to  be  a  commoner  as  he  had 
been  to  be  governor,  pointed  out  in  his  place  in  Parliament, 
in  1891,  that  17,937,570  acres  of  land  were  held  by  only 
1615  landowners,  while  100,000  people  occupied  less  than 
300,000  acres.  And  seven  years  later,  in  his  "Long  White 
Cloud,"  the  Honourable  William  Pember  Reeves  showed 
that  "in  spite  of  land  laws,  land-tax,  and  time,  out  of  34,- 
000,000  acres  of  land  21,000,000  are  held  in  areas  of  more 
than  5000  acres." 

126 


TRUSTEES   FOR   THEMSELVES  127 

Sir  George  Grey  asked,  "Does  it  not  seem  almost  incred- 
ible that  so  great  a  disparity  should  exist,  and  that  that 
disparity  should  have  been  created  by  the  rulers  of  this 
country,  the  trustees  of  the  public  lands  which  belong  to 
the  whole  people  ?" 

He  raised  a  question  which  has  not  been  answered  yet — 
a  notable  question  to  have  been  asked  by  an  aristocrat  of 
aristocrats. 

"I  doubt,"  he  said,  "that  all  these  vast  properties  have 
been  'legally'  acquired  as  we  are  told.  If  trustees  make 
laws,  possibly  for  their  own  benefit,  can  it  be  said  that 
when  their  wards  are  left  in  such  a  state  of  poverty  and 
distress  the  distribution  that  has  been  made  of  the  common 
property  has  been  'lawfully'  made?" 

As  early  as  1870  this  tendency  to  consolidation  had  been 
seen  and  deplored,  and  the  compulsory  resumption  of  the 
lands  alienated  so  wastefully,  and  in  many  cases  worse  than 
wastefully,  had  been  suggested.  Sir  George  Grey  was  an 
advocate  of  resumption,  and  in  1887  Sir  Robert  Stout  in- 
troduced a  bill  for  compulsory  repurchase,  but  nothing  ef- 
fectual was  done,  and  the  aggregation  of  huge  estates  went 
on.  Some  of  the  ministries  tried  in  various  ways  to  create 
and  keep  an  independent  yeomanry,  and  other  ministries 
did  their  best  to  thwart  these  efforts. 

As  one  way  to  prevent  concentration  lands  were  sold 
in  small  parcels  and  were  leased  instead  of  being  sold,  but 
the  small  men  sold  out  or  were  sold  out.  When  land  was 
offered  in  small  pieces  to  perpetuate  "the  yeomanry,"  the 
great  companies  and  the  large  landowners  in  the  vicinity 
had  their  shepherds  and  cooks  and  station  managers  and 
their  workingmen  and  even  their  wives  buy  the  land,  and 
then  transfer  it  to  them.  Owners  were  allowed  a  certain 
amount  of  land  in  proportion  to  the  \vire  fencing  they 
erected,  and  they  ran  their  fences  along  the  public  roads 


128         A  MAN  BETTER  THAN  A  SHEEP 

and  the  streams  and  up  the  fertile  valleys,  acquiring  long 
and  narrow  strips  for  themselves,  rendering  all  the  land 
behind  them  useless  to  other  settlers. 

The  alienation  of  the  land,  it  must  not  be  forgotten  how- 
ever, was  not  entirely  the  fault  of  the  land  speculator  and 
the  monopolist.  In  the  early  days  the  colony  was  very  glad 
to  sell  its  land.  It  was  a  gala  day  long  remembered  in 
Christchurch  when  the  provincial  government  of  early 
times  was  able  to  announce  that  it  had  made  a  sale  of  land 
by  which  it  could  reduce  the  railway  bonds  by  £50,000. 
The  provinces  sold  their  land  to  pay  off  their  debts,  for 
land  was  the  only  convertible  property  they  had. 

The  abuses  of  the  four  years  from  1887  to  1891  made  that 
administration  a  carnival  of  land  dissipation,  and  its  Min- 
ister of  Lands  was  known  as  "The  High  Priest  of  Dum- 
myism." 

"The  land  grabbers  picked  out  the  eyes  on  the  plains," 
a  New  Zealander  explained  to  me,  "and  left  only  the  hills 
and  mountains.  When  the  farmers  came  along  they  had 
to  ask,  'Shall  sheep  and  cattle  occupy  the  plains,  and  our 
wives  and  children  go  to  the  mountains  and  the  hills  ?' ' 

Gold  diggers  and  hunters  would  come  back  telling  of  the 
beautiful  land  they  had  seen,  which  the  people  could  not 
even  look  at,  for  the  squatters  and  land  grabbers  would 
not  let  any  one  penetrate  their  fences,  and  would  send  their 
servants  to  dog  any  one  venturing  inside. 

The  land  was  mostly  in  the  hands  of  joint-stock  companies 
and,  even  worse,  absentee  corporations.  The  managers  of 
these  companies,  all  British,  of  course,  were  driven  by  the 
demands  of  their  stockholders  in  London  for  dividends  to 
do  things  no  other  landlord  in  the  country  would  do. 
They  put  through  the  courts  a  tenant  who  was  behindhand 
when,  if  they  had  been  individual  owners  instead  of  com- 
panies, he  would  have  got  time  and  escaped  ruin. 


SIR   GEORGE   GREY  129 

Minister  of  Lands  McKenzie,  in  the  debate  on  the  land 
bills  which  followed  the  tax  bill  in  the  programme  of  re- 
form, quoted  with  great  effect  from  a  speech  of  the  chair- 
man of  one  of  these  great  companies  to  the  shareholders  in 
London. 

"He  said  they  were  going  to  declare  a  dividend  and  bonus 
of  fifteen  per  cent.,  but  the  shareholders  could  not  look  for 
any  higher  dividends  or  bonuses  until  wages  had  been  re- 
duced in  New  Zealand." 

The  minister  declared  that  these  companies  wanted  the 
workingmen  of  the  colony  to  be  "actual  slaves,"  and  that 
their  influence  was  being  unitedly  thrown  against  the  land 
reforms  he  was  proposing,  because  it  would  enable  these 
poor  men  to  get  out  of  the  rut  of  poverty. 

The  pressure  for  land  became  a  political  pressure.  The 
issue  between  "squatters" — as  the  great  land  grabbers  were 
called — and  settlers,  between  man  and  sheep,  was  one  of  the 
crucial  issues  of  the  campaign  of  1890. 

"No  matter  what  party  a  candidate  belonged  to,"  I  was 
told,  "he  was  sure  to  be  asked  at  the  polls  again  and  again, 
'What  will  you  do  about  the  land?" 

If  the  New  Zealanders  had  strong  democratic  ideas  about 
the  social  control  of  land,  it  is  easy  to  see  where  they  got 
them.  Besides  the  tutoring  of  experience,  they  had  been 
taught  such  views  from  the  beginning  by  a  series  of  remark- 
able men.  Along  with  the  selfish  and  often  illegal  absorp- 
tion of  land  there  went  from  the  first  an  active  and  noble 
movement  in  opposition  to  it. 

Foremost  among  the  land  democrats  was  Sir  George 
Grey.  By  a  happy  opportunity  he  was  made  a  builder  of 
the  foundations  of  society  in  places  as  far  apart  as  South 
Australia,  New  Zealand  and  South  Africa.  He  did  his 
best  to  affect  with  some  touches  of  justice  and  common 
sense  the  policy  of  the  British  Empire  to  its  hundreds  of 


130        A  MAN  BETTER  THAN  A  SHEEP 

millions  of  subject  races,  and  his  influence  reached  even  to 
India.  He  was  able  to  arrest  the  policy  which  first  robbed 
the  natives  and  then  created  monopoly  and  aristocracy 
through  the  division  of  the  plunder.  From  first  to  last 
Grey  was  a  faithful  preacher  of  "land  for  the  people,"  even 
in  England  and  Ireland  as  well  as  in  the  colonies. 

Sir  Robert  Stout,  several  times  Premier  and  now  Chief 
Justice  of  New  Zealand,  the  most  intellectual  and  cultivated 
radical  in  the  Southern  hemisphere,  and  John  Ballance, 
whose  name  is  revered  from  end  to  end  of  New  Zealand  as 
the  greatest  Liberal  Premier  of  the  past,  always  put  the 
democratisation  of  land  first  in  their  programme. 

To  the  financial  genius  of  Sir  Julius  Vogel  it  is  due 
that  at  least  half  a  century  was  gained  in  the  development 
of  railroads,  public  works,  immigration  and  land  settlement 
through  the  investment  of  British  capital  in  the  bonds  of 
New  Zealand.  The  most  important  part  of  his  public  works 
scheme  was  that  the  community  should  secure  the  enor- 
mous increase  in  the  value  of  lands  which  he  foresaw  must 
follow.  This  he  was  forced  to  throw  overboard  by  the 
prejudice  and  selfishness  of  the  Parliament  of  the  day,  but 
the  idea  could  not  be  thrown  over. 

When  John  Ballance  became  Premier  and  John  McKen- 
zie  Minister  of  Lands,  in  1891 — a  position  in  which  Mc- 
Kenzie  has  continued  with  Premier  Seddon  since  the  death 
of  Ballance  in  1893 — the  hour  and  the  men  to  toll  the 
knell  of  land  monopoly  in  New  Zealand  arrived. 

McKenzie  had  been  a  boy  in  the  Highlands.  The  land- 
lord was  the  head  teacher  in  the  hard  school  in  which  he 
learned  the  political  economy  of  land.  When  he  was  push- 
ing his  land  bills  through  the  New  Zealand  Parliament  he 
was  twitted  by  members  of  the  Opposition,  who  sneeringly 
"wondered  where  he  got  his  ideas !" 

"In  the  glens  of  Scotland,"  he  replied. 


LANDLORD  TEACHERS  131 

"What  made  me  a  reformer?"  he  said  in  answer  to  a 
question  from  me. 

"When  I  was  a  little  boy,  one  day  going  along  the  coun- 
try road  with  my  father  I  saw  a  lot  of  people,  about  thirty 
families,  who  had  been  evicted  from  Glen  Calvie.  They 
were  not  allowed  to  stop  even  in  the  public  highway.  There 
had  been  but  one  place  opened  to  them,  and  we  found  them 
in  that.  There  they  were,  a  hundred  souls  or  more,  mak- 
ing their  fires  and  cooking  their  morning  meal  in  the  ceme- 
tery of  Kilcairdin,  among  the  graves.  They  had  slept  in 
the  church,  and  they  ate  in  the  shadow  of  the  tombstones, 
the  living  among  the  dead. 

"I  have  seen  in  the  Highlands  of  Scotland  the  ground 
harrowed  over  during  the  night  in  order  to  hide  the  blood 
shed  by  the  people  who  had  been  trying  to  defend  their 
homes." 

The  minister  revisited  his  boyhood  home  in  1899,  and 
when  he  came  back  he  had  had  another  lesson.  In  a  public 
address  upon  his  return  he  told  how  old  neighbours  had 
come  to  him  and  begged  that  he  would  not  make  any 
speeches  there  on  the  land  question,  lest  the  landlord  take 
offence  and  they  suffer.  There  are  "Outlanders,"  it  would 
seem,  nearer  home  than  the  Transvaal! 

"It  was  sheer  necessity  that  drove  me  into  politics,"  he 
said  in  describing  his  early  career.  "When  I  came  from 
Rosshire  to  the  Otago  district  of  the  South  Island  we  had 
no  schoolhouses,  no  post-offices,  no  roads,  no  bridges — the 
country  was  a  wilderness.  I  was  the  first  settler.  When 
others  came  we  united " 

"To  demand  these  improvements  of  the  government?"  I 
interrupted,  in  Americanese. 

"No,"  he  said,  in  New  Zealandese,  "to  assist  each  other 
to  get  them  by  the  use  of  our  political  powers." 

He  was  secretary  of  the  first  school  board,  and  the  school 


132         A  MAN  BETTER  THAN  A  SHEEP 

which  started  with  twelve  children  now  has  five  hundred. 
lie  was  the  secretary  of  the  road  board. 

"I  made  the  first  road,"  he  said,  "in  the  district,  and 
never  put  a  level  on  it,  for  I  had  none.  But,"  he  added 
with  pride,  "it  has  never  been  altered.  I  was  secretary  also 
for  nine  years  of  the  old  Otago  Land  Board." 

Mr.  McKenzie  for  twenty-nine  years  has  been  in  public 
positions  of  one  kind  and  another  in  New  Zealand,  from 
secretary  of  the  Otago  Land  Board  to  member  of  Parlia- 
ment and  Minister  of  Lands,  and  has  never  been  defeated  in 
an  election. 

"The  laws  in  those  days  were  all  made  by  monopolists. 
Land  squatters  and  speculators  and  land  grabbers  got  into 
the  provincial  councils  and  made  laws  to  suit  themselves. 
The  people  had  no  voice.  A  man  had  to  hold  a  certain 
area  of  land  before  he  could  get  a  vote,  and  the  people  were 
represented  entirely  by  one  class,  and  they  made  the  laws 
to  suit  themselves.  I  found  the  situation  so  obnoxious  that 
I  resigned  from  the  Otago  Land  Board.  It  was  of  no  use 
to  go  to  the  meetings,  for  I  could  do  nothing.  These 
people  had  picked  out  all  the  best  pieces  of  land  under  laws 
which  they  made  and  administered  entirely  in  their  own 
interests.  Our  young  men  and  young  women  were  grow- 
ing up  and  could  find  no  land  to  settle  on.  They  were  capa- 
ble enough  and  had  capital,  but  they  had  no  land.  The 
cry  among  the  farmers  was  'What  shall  we  do  with  our 
boys  ?'  Out  of  this  situation  sprang  the  land  laws,  and  the 
land  and  income  and  inheritance  taxes." 

The  land  situation  was  so  bad  when  Bal lance  and  Mc- 
Kenzie set  themselves  to  find  a  remedy  as  to  justify  the 
statement  made  by  a  member  of  Parliament  that  "We  have 
had  the  most  pernicious  system  of  land  legislation  in  this 
colony  that  has  ever  been  known  in  any  civilised  country 
in  the  world.  Our  land  laws  were  designed  by  squatters, 


LIKE  THE  TENANTRY  AT  HOME        133 

in  the  interest  of  squatters,  and  they  have  been  adminis- 
tered by  squatters'  nominees  for  the  purposes  of  land  jobbery 
and  monopoly."  "Now  is  the  time  to  get  rid  of  them," 
said  another  member  in  Parliament. 

Minister  McKenzie  had  a  map  made  which  he  hung  up 
before  Parliament,  showing  how  the  country  was  blackened 
with  the  great  holdings.  They  saw  the  huge  estates  and 
how  the  land  was  "gridironed"  and  "spotted."  In  the  set- 
tlement of  the  colony,  the  frontages  along  the  roads  and 
rivers,  and  around  watering  places,  and  at  the  heads  of 
valleys,  were  all  taken  up  under  laws  made  by  the  great 
landowners  for  the  great  landowners.  All  the  river  flats 
and  gullies  and  every  stream  and  highway  had  been  picked 
up.  This  rendered  access  to*  the  lands  in  the  rear  impos- 
sible, and  made  them  useless  even  with  access,  since  they 
were  cut  off  from  water.  Behind  these  frontages  were 
millions  of  acres  of  back  country,  which  were  held  under 
lease  from  the  state  by  the  owners  of  the  frontages,  and 
were  of  no  value  to  anybody  but  them.  The  leases  were 
to  expire  in  1896,  and  the  colony  would  have  then  on  its 
hands  these  millions  of  acres  which  it  could  sell  or  let  to 
no  one  but  the  owners  of  the  frontages.  Unless  some  way 
were  found  of  breaking  through  their  cordon,  the  men  who 
had  "spotted"  the  country  would  own  the  country. 

A  tenantry  was  arising  in  New  Zealand  just  like  the  ten- 
antry at  home.  As  Minister  McKenzie  showed  Parliament 
in  presenting  his  land  bills,  there  were  already  in  New  Zea- 
land more  farmers  who  were  tenants  than  farmers  who 
owned  their  lands. 

The  majority  of  the  farmers  of  New  Zealand  were  pass- 
ing under  the  yoke  of  the  mortgage.  Fifty-eight  per  cent, 
of  those  who  occupied  their  own  land  were  mortgaged  so 
heavily  that  their  interest  was  equivalent  to  a  rack  rent. 

The  country  was  paying  enormous  sums  of  money  every 


134        A  MAN  BETTER  THAN  A  SHEEP 

year  for  interest  on  the  loans  that  had  made  the  railways, 
roads,  and  other  public  works,  and  added  unearned  incre- 
ment to  the  lands  that  had  been  sold  for  a  mess  of  pottage ; 
but  these  lands  kept  in  sheep  were  sending  all  their  profits 
to  Great  Britain. 

The  proceeds  of  this  beautiful  country,  the  minister  told 
Parliament,  are  being  wasted  in  riotous  living  by  absentee 
spendthrifts. 

Immigration  began  to  move  the  wrong  way.  An  exodus 
from  the  colony  set  in,  or  rather  set  out.  "Many  people," 
said  John  Ballance  to  Parliament,  "are  leaving  New  Zea- 
land for  other  shores  because  they  cannot  get  land  here. 
Unless  the  big  estates  are  dealt  with,  this  exodus  must  con- 
tinue. There  never  yet  was  a  country  with  large  estates 
that  continued  to  prosper." 

Whole  districts  in  the  colony  were  being  starved  for 
want  of  land  for  expansion,  and  the  sons  of  the  country 
were  being  forced  out.  The  minister's  map  showed  how 
the  land  had  been  "mopped  up"  by  companies,  banks  and 
speculators.  "In  fifteen  years,"  he  told  Parliament,  if 
things  went  on  as  they  were  going,  "there  will  not  be  an 
acre  of  land  left  for  settlement  in  this  colony,  and  the  lands 
will  be  in  the  hands  of  250,000  people.  By  that  time  three 
out  of  every  four  individuals  in  the  colony  will  be  land- 
less. The  children  of  five  years  and  under,  now,  will  have 
no  land  to  settle  upon  when  they  come  of  age.  We  have 
parted  with  something  like  13,000,000  acres  of  our  best 
agricultural  lands,  and  we  have  only  about  2,000,000  acres 
suitable  for  disposal  in  small  areas." 

With  a  country  that  could  support  easily  ten  millions  of 
people— Japan  has  50,000,000 — New  Zealand,  with  less 
than  750,000,  found  itself  with  a  scarcity  of  land.  There 
was  springing  up  in  New  Zealand  a  landlordism  nothing 
better  than  what  has  gone  before  in  the  old  country.  Mr. 


CRUELTIES  OF  THE  FREEHOLD          135 

McKenzie  pointed  to  places  in  his  own  electorate  where  ten- 
ants were  paying  rents  at  a  rate  of  two  hundred  and  fifty  per 
cent,  on  the  price  given  the  government  for  the  land — in 
good  seasons  just  pulling  through;  in  bad  seasons,  "the 
usual  clearing-out  sale,"  and  ruin  for  them  and  the  trades- 
men and  the  business  people  dependent  upon  them. 

"The  cruelty  of  the  freehold"  was  a  phrase  often  found 
on  Mr.  McKenzie's  lips  in  his  speeches  in  and  out  of  Par- 
liament.    He  told  how  freehold  gives  the  right  to  the  owner 
to  turn  people  out  of  their  homes,  to  burn  the  roofs  of  their 
dwellings  so  that  they  may  not  return  to  them,   and  to 
leave  them  starving  on  the  roadside,  as  he  had  seen  them. 
It  was  the  freehold  which  was  responsible  for  the  deer  for- 
ests in  Scotland.    "The  whole  country-side  in  parts  of  Scot- 
land," he  said,  "has  been  depopulated  of  small  settlers,  de-  - 
populated  of  the  men  who  fought  and  won  the  battles  of 
Great  Britain  in  the  past.     Who  scaled  the  heights  of  Alma  ? 
Who  made  the  charge  of  Balaklava?     Who  relieved  Luck-f 
now?     Who  were  in  a  hundred  other  fights?     Who  but/ 
the  Highland  regiments,  which  were  drawn  from  these  very ' 
men  ?     Who  but  themselves,  their  relations,  and  their  fami-  ,' 
lies  were  driven  off  the  straths  and  glens  to  make  room  for 
deer  forests  for  noblemen?" 

"The  history  of  the  Highland  evictions — the  Sutherland 
clearings — tells  how  many  thousands  of  families  were 
broken  up  by  the  landlords  and  the  freeholders,  and  scat- 
tered all  over  the  face  of  the  earth — the  homes  of  the  many 
made  desolate,  so  that  the  few  can  reign  in  plenty  and 
wealth." 

I  once  walked  through  the  Glen  Tilt,  a  summer's  day, 
from  Braemar  to  Blair-Athol.  The  river  Tilt  runs  its  cur- 
rent of  liquid  cairngorms  between  the  velvety  hills  of  a 
great  deer  forest,  where,  by  the  way,  there  was  to  be  seen 
neither  deer  nor  forest.  All  day  long  we  passed  from  one 


136         A  MAN  BETTER  THAN  A  SHEEP 

little  homestead  to  another,  but  the  homesteads  consisted 

only  of  demolished  walls  and  foundations  levelled  to  the 

ground,    and   the   only    inhabitants    were   memories.     We 

stopped  at  a  peasant's  cottage  near  the  entrance  to  Blair- 

Athol  and  the  park  of  the  great  duke  to  get  a  glass  of  milk. 

"Glen  Tilt,"  the  farmer's  wife  told  us,  "used  to  send  a 

thousand  men  to  the  wars  to  defend  their  country,  but  the 

(    people  have  all  been  driven  away  and  their  homes  destroyed 

|   to  make  the  deer  forests  you  have  been  walking  through. 

And,"  she  added,  with  a  gleam  in  her  eye,  "they  have  gone 

to  America,  Australia  and  Canada,  and  from  there  they 

.   are  sending  into  our  markets  their  cattle  and   wheat  at 

1  prices  which  are  drying  up  the  rents  of  the  very  lords  who 

1  banished  them." 

Naturally  Minister  McKenzie  criticises  the  new  Irish 
land  policy  of  the  British  government,  by  which  the  gov- 
ernment advances  money  to  the  peasant  to  buy  the  free- 
hold. This  will  end,  he  predicts,  in  mortgaging  and  con- 
solidation. 

/      Behind  the  freehold  Mr.  McKenzie  saw  gathering  in  New 

'  Zealand  all  the  things  he  had  been  taught  by  the  lords  of 

|  the  Highlands  to  hate — the  power  to  rack-rent,  foreclose  and 

evict,  to  add  field  to  field,  to  put  deer  and  sheep  where  men, 

women  and  children  might  be,  to  speculate  and  monopolise. 

"We  have  had  the  freehold  for  fifty  years,"  the  minister 

said  to  Parliament,  "and  the  result  is  these  big  estates,  the 

greatest  curse  of  New  Zealand." 

If  you  chance  to  overhear  the  expression  "social  pests" 
in  New  Zealand  you  will  find  nine  times  out  of  ten  that  it 
is  the  great  estates  that  are  the  subject  of  conversation. 
"Social  pests"  is  New  Zealandese  for  land  monopolists. 

Another  of  the  current  phrases  in  New  Zealand  is  an 
expression  which  flew  from  the  lips  of  the  Minister  of  La- 
bour, the  Honourable  William  Pember  Reeves,  author  of 


NO  WAR  AGAINST  CAPITAL  137 

the  Compulsory  Arbitration  law,  in  a  hot  debate  in  Parlia- 
ment— that  it  was  necessary  to  "burst  up  the  great  estates." 

In  answer  to  the  threat  of  the  Conservatives  that  the 
great  land  companies  would  leave  the  country  if  the  pro- 
posed legislation  hostile  to  them  were  enacted,  Premier  Bal- 
lance  said  in  Parliament : 

"We  do  not  care  what  these  huge  companies  do.  We 
shall  not  sink  even  if  they  all  pack  up  and  go." 

He  was  not  warring  against  capital,  he  explained,  but 
he  meant  to  restrict  the  flow  of  capital  to  large  estates  and 
to  stimulate  the  flow  of  capital  into  small  estates. 

Minister  McKenzie  told  Parliament  of  a  demand  for  more 
land  made  upon  him  by  one  of  the  men  into  whose  maw 
had  been  going  most  of  the  land  which  the  colony  had  sold 
in  his  vicinity  in  small  parcels  to  meet  the  need  for  small 
farms. 

"He  told  me  that  he  had  already  purchased  a  very  large 
area  for  cash.  He  said,  'I  want  another  three  thousand 
acres,  or  I  am  going  to  leave  the  country.'  I  told  him  that 
I  would  be  very  glad  to  see  him  leave  it." 

It  was  these  abuses  coming  to  a  head  after  years  of  suffer- 
ing that  made  the  New  Zealand  people  move  at  last. 

As  a  step  toward  a  remedy,  and,  as  Minister  McKenzie 
said,  "only  a  step,"  two  laws  were  passed  and  amended  in 
the  years  1892  and  following.  One  of  these  laws  under- 
took to  prevent  future  monopoly  in  the  public  lands;  the 
other  to  break  up  by  purchase,  compulsory,  if  need  be,  the 
monopoly  already  existing  in  private  lands.  Both  made 
ample  and  particular  provision  for  the  resettlement  of  the 
people  on  the  land,  especially  as  tenants  of  the  state,  in- 
stead of  private  owners.  The  main  idea  of  both  these  laws 
is  the  same — that  land  shall  be  held  only  for  use  and  for 
such  use  only  as  is  for  the  public  good,  and  that  the  public 
is  the  only  judge  of  what  is  "good"  for  it. 


1 38   A  MAN  BETTER  THAN  A  SHEEP 

The  ultimate  ideal  of  the  New  Zealand  system  is  that 
the  state  shall  be  the  only  landowner,  the  only  freeholder; 
but,  with  the  political  sagacity  characteristic  of  their  blood, 
the  New  Zealanders  have  not  attempted  to  realise  this  ideal 
at  one  stroke.  They  took  but  "one  step,"  but  at  the  same 
time  they  understood  it  to  be  "but"  one  step.  In  the  new 
laws  the  hated  freehold  is  continued,  and  yet  it  is  not  con- 
tinued. It  is  practically  discontinued  in  the  disposition  of 
the  private  estates  taken  back  to  be  made  into  farms  for 
the  people,  but  is  still  given  in  the  sale  of  public  lands. 

But  new  conditions  as  to  use  and  improvement  and  area 
are  imposed,  which  take  away  from  the  new  freeholds  the 
anarchistic  right,  beloved  of  the  would-be  New  Zealand 
squire  as  of  all  squires,  "to  do  what  I  will  with  my  own," 
and  besides  these  new  restrictions  progressing  upon  him 
from  the  rear  come  the  never-resting  "progressive"  taxes. 

No  one  is  now  allowed  to  buy  or  lease  more  either  of 
the  resumed  lands  or  the  public  lands  than  640  acres  of 
first-class,  or  2000  of  second-class  land,  nor  more  pas- 
toral land  than  enough  for  2000  or  4000  sheep.  If  he 
already  holds  that  amount  of  land  he  can  get  no  more. 
Mineral  and  oil  lands  are  reserved.  The  government  offers 
its  public  lands  by  lease  or  sale.  But  it  offers  the  lands  it 
has  had  to  buy,  compulsorily  or  amicably,  on  lease  only. 
But  on  those  who  buy  and  on  those  who  lease  restrictions  are 
imposed  to  prevent  monopoly  and  insure  use — restrictions 
of  area,  use,  improvements.  No  one  can  attain  the  dignity 
of  state  tenant  who  cannot  pass  a  satisfactory  examination 
showing  that  he  has  the  money,  knowledge  and  character 
necessary  for  success.  No  one  can  retain  his  farm,  whether 
bought  or  leased,  unless  he  is  found  to  be  faithfully  comply- 
ing with  all  the  requirements.  Leases  can  be  sold  by  the 
tenant,  but  the  new  tenant  must  also  satisfy  the  Land  Board 
of  his  capability. 


ANOTHER   OPEN   DOOR  139 

A  new  tenure  is  created  by  the  new  laws — or  rather  an 
old  New  Zealand  tenure,  the  perpetual  lease,  is  perfected — 
and  special  inducements  are  given  to  make  it  more  attractive 
to  buyers  than  absolute  ownership.  It  is  called  the  ''lease 
in  perpetuity,"  and  under  it  the  occupier  is  still  the  owner, 
but  the  owner  of  a  leasehold,  not  a  freehold;  owner  of  the 
right  to  occupy,  to  use,  to  transmit  to  his  children,  to  sell, 
to  lease,  to  mortgage,  but  not  the  owner  of  the  right  to 
keep  idle,  to  speculate,  or  to  sell  to  other  speculators.  He 
is  the  owner  of  all  the  value  he  puts  into  the  ground,  or  into 
improvements  above  ground,  and  only  under  this  tenure  is 
he  the  secure  owner  of  these  values,  for,  even  if  he  for- 
feits his  lease  through  fault  or  misfortune,  the  government 
guarantees  him  the  value  of  all  his'  improvements.  Only 
under  this  tenure  also  is  he  free  from  foreclosure,  which  is 
the  terror  of  the  freehold  landowner.  "It  is  better  so  we 
cannot  lose  it,"  said  a  farmer,  explaining  why  he  preferred 
to  lease  rather  than  buy. 

This  lease  is  especially  designed  for  the  poor  man,  for 
by  it  he  can  get  his  land  without  any  payment  in  cash. 
As  the  distribution  is  made  among  the  applicants  by  lot  he 
has  the  same  chance  as  the  richest  or  the  quickest  man  in 
the  country  to  get  his  six  hundred  and  forty  acres  of  the 
best  land,  and  he  does  not  have  to  spend  a  cent  for  pur- 
chase money.  The  system  is  an  "open  door"  to  indepen- 
dence for  the  man  who  has  not  money  enough  both  to  buy 
and  work  a  farm,  but  only  enough  to  work  it.  He  can 
keep  all  his  money  for  his  farm.  The  government  makes 
the  valuation  of  the  land  low,  and  it  charges  only  four  per 
cent,  a  year  rent  for  the  newly  opened  public  lands,  and 
five  per  cent,  a  year  for  farms  cut  out  of  the  resumed  estates, 
and  this  original  valuation  is  never  increased,  but  goes  on 
without  change  for  999  years. 

Minister  McKenzie  fought  hard  to  have  the  999  year 


HO    A  MAN  BETTER  THAN  A  SHEEP 

leases  made  with  thirty  years'  revaluations,  but  had  to  choose 
between  sacrificing  this  or  the  whole  measure.  The  increased 
value  gained  in  the  future  by  the  land  of  the  leasehold 
cannot  be  reached  through  the  rent,  for  that  is  unchange- 
able for  999  years,  but  it  can  be  reached  through  the  land- 
tax.  Leasehold  and  freehold  alike  are  taxable  on  the 
"prairie  value."  If  the  land-tax  is  increased  so  as  to  soak 
up  all  the  unearned  increment  of  the  freehold,  it  will  also 
soak  up  all  the  unearned  increment  of  the  leasehold.  The 
advantage  sought  by  the  thirty  years'  revaluation  was  that 
it  provided  for  a  periodical,  automatic  increase  of  the  land- 
tax  to  soak  up  the  increased  value. 

The  tenant  has  every  right  the  freeholder  has,  except  the 
right  to  sell  without  the  consent  of  the  state  and  the  right 
to  keep  the  land  idle. 

The  New  Zealand  system  is  not  really  the  abolition  of 
the  freehold.  But  instead  of  giving  every  land  occupier  a 
little  freehold  of  his  own,  which  he  will  probably  lose  to 
the  money-lenders,  New  Zealand  makes  every  citizen  a 
joint  owner  of  all  the  freeholds.  Every  citizen  as  a  citizen 
has  a  freehold  in  the  great  estate  of  the  nation. 

The  demand  for  the  freehold  is  a  demand  that  the  free- 
hold be  taken  from  all  to  be  given  to  a  few.  But  the 
policy  of  leasehold  means  an  inalienable  fatherland  for  all. 

There  is  still  a  cry  for  the  freehold,  especially  among  the 
Conservatives,  but  it  is  largely  the  selfish  cry  of  successful 
men.  "Complaints  against  the  leasehold,"  said  the  Minis- 
ter of  Lands,  "are  largely  from  men  who  have  taken  land 
under  leasehold,  been  successful,  and  now  want  the  free- 
hold." 

"As  our  farmers  get  rich,"  said  a  prominent  member  of 
the  Liberal  party — "I  have  known  some  who  have  cleared 
the  cost  of  their  farms  in  two  crops — they  want  to  have 
$he  freehold  in  order  that  they  may  add  field  to  field,  for- 


SENTIMENTALISTS  141 

getting  that  they  themselves  are  the  beneficiaries  of  the 
break  up  of  just  such  large  estates,  as,  in  their  selfishness, 
they  would  now  like  to  found  for  themselves.  It  is  inter- 
esting, too,  to  note  that  the  Conservatives,  the  class  that 
habitually  decry  sentiment  as  out  of  place  in  economic  re- 
lations, are  the  loudest  in  pleading  for  the  freehold  on  sen- 
timental grounds." 

Such  pastoral  land  as  there  is — and  there  has  not  been 
much  as  yet  in  the  resumed  estates,  as  they  have  been  se- 
lected with  a  view  particularly  to  farming — is  not  let  on 
999  year  leases,  but  for  short  terms.  This  permits  it  to 
be  converted  into  agricultural  use  if  needed.  The  right  of 
resuming  without  compensation  is  reserved  in  certain  cases, 
so  that  the  land  may  be  used  for  closer  settlement. 

Every  year  reports  are  made  to  Parliament  showing  in 
detail  every  transaction  in  the  purchase  and  sale  of  these 
lands. 

Provision  is  made  in  the  law  for  garden  plots  and  house 
and  business  lots — the  latter  sometimes  under  freehold — 
for  the  agricultural  labourers,  mechanics,  and  others  who 
would  naturally  group  themselves  about  the  farms  cut  out 
of  the  resumed  estates.  When  employment  is  scarce,  these 
men  can  put  in  their  days  on  their  own  little  places.  Lease- 
holds cannot  be  mortgaged  nor  taken  for  debt,  though  the 
improvements  may  be. 

The  system  of  distributing  land  by  ballot  has  been  adopted 
instead  of  the  former  method  of  auction.  This  was  dis- 
continued because  people,  in  the  excitement  of  bidding, 
would  be  tempted  to  pay  more  for  the  land  than  they  could 
afford,  and  more  than  it  was  really  worth.  This  democracy 
is  a  real  estate  dealer  who  sees  to  it  that  its  lands  do  not  sell 
for  too  much. 

In  the  same  spirit  the  valuations  on  which  the  rents  are 
calculated  are  made  low.  The  state  is  a  landlord  who  sees 


i42         A  MAN  BETTER  THAN  A  SHEEP 

its  advantage  in  moderate  rents.  It  says  in  its  official  pub- 
lication, "The  state  does  not  so  much  seek  to  raise  a  reve- 
nue directly  as  to  encourage  the  occupation  of  the  lands 
by  the  people.  This  secures  indirectly  an  increased  reve- 
nue, besides  the  other  advantages  which  result  from  a  nu- 
merous rural  population." 

Advertisements  of  land  for  sale  by  the  large  holders  are 
a  constant  feature  of  the  New  Zealand  newspapers.  One 
of  the  ministers  told  me  of  a  prominent  Australian  wool 
merchant,  banker  and  landowner  who  had  just  been  inves- 
tigating the  New  Zealand  system  of  purchasing  the  large 
estates  for  settlement.  He  was  going  back  to  Australia  to 
urge  the  adoption  of  a  similar  system  there.  He  had  satis- 
fied himself  that  the  small  farmers  can  make  more  out  of 
the  land  than  the  large  holders.  The  best  way,  in  other 
words,  for  the  large  holders  to  realise  is  to  sell  to  small 
men,  and  the  best  way  to  do  that  is  through  the  govern- 
ment, which  is  the  most  popular  seller. 

Why  the  people  prefer  to  deal  with  the  government  lies 
on  the  surface. 

"The  land  htmgerers,"  I  heard  the  Minister  of  Lands 
explain,  "started  to  buy  land  of  the  great  companies,  but 
when,  as  often  happened,  the  instalments  after  the  first  were 
not  paid,  they  lost  their  first  payments,  all  their  improve- 
ments and  their  time.  They  have  no  such  experience  when 
they  buy  from  the  state.  If  they  default  it  resumes  after  a 
very  indulgent  delay,  rents  again,  appraises  the  value  of  the 
improvements,  deducts  the  rent  due,  and  pays  back  the  bal- 
ance to  the  outgoing  tenant." 

The  Minister  of  Lands  gives  this  concise  statement  of 
the  advantages  of  the  999  years  leasehold,  which  is  being 
as  far  as  possible  substituted  for  the  freehold  in  the  land 
system  of  New  Zealand : 

First.     It  enables  the  government  to  select  the  occupier. 


PRECEDENTS  FOR  EVERYTHING    143 

Second.     It  controls  the  cultivation  and  improvement. 

Third.  No  transfer  can  be  made  without  the  consent  of 
the  state. 

Fourth.  Speculation  and  its  result — monopoly — are  pre- 
vented. 

Fifth.     The  area  which  can  be  held  by  any  one  is  limited. 

There  is  absolutely  nothing  new  in  this  land  legislation 
of  New  Zealand,  neither  in  principle  nor  practice,  except 
that  the  New  Zealanders  have  done  whole-heartedly  what 
has  been  done  elsewhere  but  half-heartedly.  Not  even  the 
compulsory  resumption  of  the  great  estates  is  a  novelty. 
There  was  a  precedent  in  New  Zealand  or  English  history 
for  every  step. 

Progressive  taxation  really  began  when,  long  ago,  small 
men  were  made  exempt.  Limitation  of  area,  stipulations 
as  to  use  and  improvement,  are  parts  of  the  homestead  sys- 
tem of  the  United  States.  The  perpetual  lease  had  been 
tried  before  in  New  Zealand,  but  with  defects  which  made 
it  inoperative.  Compulsory  purchase  had  been  suggested 
in  1870,  and  proposed  in  a  bill  to  Parliament  in  1887. 

The  compulsory  feature  was  a  practical  necessity  in  any 
reform  of  the  New  Zealand  land  system.  Some  owners 
would  not  sell,  some  asked  extravagant  prices,  and  some, 
who  would  have  been  glad  to  sell,  could  not  because  they 
were  in  the  hands  of  the  mortgage  companies.  Some  of 
the  owners  of  the  "spotted  frontages"  that  have  been  de- 
scribed were  defiant  in  their  refusal  to  sell.  Behind  them 
lay  millions  of  acres  useless  to  the  government  or  the  people 
unless  their  frontage  could  be  taken. 

Minister  McKenzie  made  good  use  of  the  English  pre- 
cedent as  to  compulsory  resumption  of  the  land. 

"What  are  they  doing  in  Great  Britain?  Does  not  the 
state  interfere  with  the  land  there,  although  the  land  does 
not  belong  to  the  state?  Have  they  not  appointed  royal 


144        A  MAN  BETTER  THAN  A  SHEEP 

commissioners  and  sent  them  down  to  the  Highlands  of 
Scotland  to  fix  the  price  and  regulate  other  things?  Have 
they  not  also  introduced  legislation  there  to  take  back  the 
land  with  a  view  of  putting  a  class  of  small  owners  upon 
it  ?  Is  not  that  the  state  interfering  with  the  land  ?  .  .  . 
The  people  of  any  country  have  a  right  to  interfere  with  it." 

All  civilised  countries  exercise  the  power  of  condemning 
land  when  the  public  good  requires.  Premier  Seddon  said, 
in  speaking  of  this  principle  in  Parliament: 

"It  is  just  as  important  to  the  colony  to  take  land  for 
settlement  as  for  roads,  or  railways,  or  for  mining  pur- 
poses." 

Compulsory  purchase  was  at  first  defeated  in  Parliament, 
but  Minister  McKenzie  made  the  campaign  of  1893  on  that 
issue  in  his  district,  and  was  triumphantly  returned. 

"On  every  platform  during  the  recess  I  said  that  the 
time  had  arrived  when  it  was  necessary  to  take  land  com- 
pulsorily  for  settlement.  On  every  occasion  when  I  said 
that  it  was  applauded  by  the  people."  Seventeen  of  the 
twenty-seven  members  who  had  opposed  this  measure  in 
Parliament  and  had  threatened  that  he  should  never  be  al- 
lowed to  come  back  were  themselves  not  allowed  to  return 
by  their  constituents.  Three  times  compulsory  purchase 
passed  the  House  of  Representatives,  but  was  thrown  out 
by  the  upper  house,  but  the  ministry  persisted  in  demand- 
ing it. 

"The  government  is  determined,"  Minister  McKenzie  told 
Parliament  in  1893,  "to  stand  or  fall  by  compulsory  pur- 
chase." 

It  finally  passed  the  House  of  Representatives  by  a  vote 
of  fifty  to  five,  and  the  upper  house  then  surrendered. 

As  in  the  case  of  compulsory  arbitration,  here  the  possi- 
bility of  compulsion  made  compulsion  itself  usually  un- 
necessary. The  government  has  had  to  resort  to  condem- 


NO    SENTIMENTAL   DAMAGES  145 

nation  in  only  two  instances,  and  is  offered  more  estates  in 
all  parts  of  the  country  than  it  needs. 

An  attempt  is  now  being  made  by  one  of  the  great  land- 
owners, whose  property — the  Hatuma  estate — is  being  taken 
under  condemnation  proceedings,  to  break  down  the  law  by 
demanding  from  the  courts  compensation  not  only  for  the 
market  value  of  the  land,  but  for  the  disturbance,  sentimen- 
tal and  other,  to  which  he  will  be  subjected.  The  former 
chief  justice  supported  his  contention,  but  his  place  is  now 
filled  by  Sir  Robert  Stout,  the  philosophic  radical.  The 
government,  on  its  side,  stands  for  the  American  rule  of 
damages  in  such  cases,  which  gives  the  landowner  only  the 
market  value.  The  owner  in  this  case,  who  is  an  absentee, 
is  likely  to  carry  the  case  to  the  Privy  Council  of  England, 
but  even  if  he  does  so,  and  even  if  the  decision  of  the  Privy 
Council  is  in  his  favour,  it  will  not,  I  was  assured  by  prom- 
inent members  of  the  ministry,  have  the  slightest  effect  upon 
the  policy  of  New  Zealand  in  this  matter. 

The  establishment  of  the  claim  for  sentimental  damages 
would  upset  the  new  land  system  completely.  The  land 
which  is  condemned  must,  by  the  terms  of  the  law,  be  leased 
to  the  small  farmers  at  a  price  which  will  produce  five  per 
cent,  revenue  on  its  cost,  including  surveys,  roads,  etc.  The 
addition  of  sentimental  damages  to  the  cost  would  increase 
the  rental  beyond  the  ability  of  the  small  farmers  to  pay. 
,No  decision  of  the  courts,  therefore,  either  at  home  or  in 
England,  will  avail  to  arrest  the  policy  of  compulsory  pur- 
chase, for  upon  that  the  entire  fabric  of  land  reform  in  New- 
Zealand  rests. 

This  matter  was  attended  to  in  the  session  of  1899  by 
an  amendment  to  the  law  which  provides  that  when  land  is 
taken  by  compulsion  the  compensation  given  the  owner  shall 
be  only  the  value  of  the  land  and  the  loss  to  his  business 
which  he  incurs  from  the  condemnation. 


i46         A  MAN  BETTER  THAN  A  SHEEP 

This  is  the  rule  of  damages  which  has  been  established  by 
the  American  railroads,  through  the  courts,  for  the  land 
they  take  from  the  private  owner  by  compulsion.  It  is  also, 
therefore,  the  rule  of  damages  which  will  be  applied  to  the 
American  railroads  by  the  people  when  they,  like  the  Swiss, 
take  back  their  highways. 

"We  must  experiment  cautiously,"  Minister  McKenzie 
said,  in  introducing  his  land  bill  of  1892.  Only  £50,000  a 
year  was  asked  from  Parliament  for  the  first  year's  purchase 
of  estates.  As  the  experiment  felt  its  way  toward  success 
this  amount  was  increased  to  £250,000  a  year,  and  later  to 
£500,000  a  year — $2,500,000. 

Everything  connected  with  this  legislation  was  done  in 
this  spirit  of  "experimenting  cautiously."  No  really  new 
path  was  opened.  All  that  was  done  was  to  move  one  step 
farther  in  the  old  path  of  the  land  reform  to  which  New 
Zealand  had  been  committed  from  the  earliest  years  of  its 
colonial  life. 

The  greatest  care  was  taken  so  to  constitute  the  boards 
which  investigate  and  recommend  the  purchase  of  the  re- 
sumed estates  that  they  shall  be  composed  of  the  very  best 
men  for  the  work,  and  shall  be  free  from  jobbery  in  con- 
nection with  the  landowners,  and  free  from  political  jobbery. 

In  resuming  land  small  estates  are  not  taken,  and  in 
the  case  of  large  estates  the  owner  has  the  prior  right  to 
the  lease  of  his  homestead  and  six  hundred  and  forty  acres, 
of  first-class  land.  He  has  also  the  right  to  require  that 
the  government  shall  take  the  whole  of  his  estate  if  it  takes 
any.  Throughout,  it  will  be  seen,  the  rights  of  the  private 
owners  are  strongly  safeguarded.  As  a  result  there  is  no 
social  bitterness.  There  is  no  cry  on  the  one  side  for  spoli- 
ation, no  feeling  on  the  other  of  having  been  despoiled. 
The  colony  is  offered  more  estates  than  it  can  buy,  and  there 
are  but  few  cases  in  which  the  owners  will  not  accept  its 


TO   MAKE    SURE   OF   THE   HOME         147 

terms.  In  one  of  the  only  two  cases  in  which  condemnation 
has  been  resorted  to,  the  owners  were  willing  to  sell,  but  the 
agent,  they  being  absentees,  wished,  for  his  own  protection 
and  the  satisfaction  of  his  clients,  that  the  terms  of  the  sale 
should  be  legally  fixed  by  the  Compensation  Board. 

People  who  have  been  living  on  the  estates  as  workmen, 
shepherds,  station  keepers,  have  special  privileges  in  the  se- 
lection of  the  land  on  which  they  have  been  living  before  the 
estate  is  thrown  open  to  the  general  public.  The  lease  in 
perpetuity  is  favoured  by  the  government  to  make  itself 
the  only  freeholder  and  convert  all  the  landowners  ulti- 
mately into  state  tenants,  but  it  is  not  forced  on  the  settlers. 
Recognising  that  the  prejudices,  habitudes  and  preferences 
of  centuries  o£  freehold  experience  were  not  to  be  overcome 
in  a  day,  the  settler  in  the  case  of  public  lands  is  allowed  to 
choose  freehold  or  leasehold  as  he  wishes.  He  can  buy  for 
cash,  or  lease  with  the  right  of  purchase,  or  lease  in  per- 
petuity. 

But  no  such  choice  is  given  in  the  case  of  the  farms  cut 
out  of  the  resumed  estates.  It  would  be  love's  labour  lost 
to  break  these  up  and  then  dispose  of  them  under  a  tenure 
which,  as  all  previous  experience  proves,  would  start  them 
again  travelling  the  road  that  leads  to  consolidation.  Some 
of  the  very  estates  repurchased  under  the  new  law  by  the 
government  were  years  ago  sold  by  it  in  small  sections  to 
favour  small  farmers.  It  is  willing  to  recognise  in  the  dis- 
posal of  the  public  lands  the  various  preferences  of  the 
selectors  as  to  tenure,  but  it  is  equally  determined  never  to 
part  again  with  its  ownership  of  the  lands  which  it  is  buy- 
ing back. 

Minister  McKenzie  told  Parliament  that  he  proposed  the 
lease  in  perpetuity  largely  in  answer  to  the  entreaties  of 
settlers  who  had  been  foreclosed  by  the  money-lenders, 
under  the  freehold  system,  and  had  come  to  him  and  written 


H8    A  MAN  BETTER  THAN  A  SHEEP 

to  him  asking  for  a  perpetual  lease  under  which  they  would 
be  sure  of  their  homes  forever. 

"Speculation''  is  a  word  that  Minister  McKenzie  hates 
as  much  as  "freehold."  It  is  one  of  the  "cruelties"  he 
charges  upon  the  freehold.  He  framed  the  new  law  for  the 
disposal  of  the  public  lands  so  as  "to  keep  every  speculator 
out  of  them,"  he  told  Parliament.  And  of  his  bill  for  the 
purchase  and  subdivision  of  the  estates,  he  said  in  the  same 
way: 

"No  big  estates  will  grow  out  of  the  land  purchased  under 
this  law.  It  has  been  rendered  impossible.  .  .  .  No 
one  has  the  right  to  purchase,  and  therefore  there  can  be 
no  speculation." 

Under  the  lease  in  perpetuity  designed  by  Minister  Mc- 
Kenzie the  settlers  become  tenants  of  the  Crown.  There  is 
no  middleman,  and  there  can  be  no  transfer  without  the 
consent  of  the  government. 

"They  will  soon  find  that  there  can  be  no  speculation 
there,"  the  minister  said. 

I  heard  of  an  encounter  between  Mr.  McKenzie  and  one 
of  these  speculators  whom  he  so  much  detests. 

This  speculator  had  four  times  got  freeholds  from  the 
government,  and,  after  holding  each  of  them  a  short  time, 
sold  and  pocketed  a  handsome  profit.  One  day  a  deputa- 
tion appeared  from  the  North  Island,  demanding  to  be  given 
the  freehold  of  a  lot  of  land  its  members  hold  under  lease. 
Though  Minister  McKenzie  had  never  seen  the  man  just 
spoken  of,  he  had  heard  his  name,  and  it  was  that  of  the 
leader  of  the  delegation.  Questioning  him  as  to  his  vari- 
ous places  of  residence,  he  soon  found  that  he  had  before 
him  the  speculating  settler. 

"Now,"  he  said,  "you  have  had  four  chances  at  a  free- 
hold. You  have  four  times  got  land  for  your  own  home. 
You  have  speculated  in  it  and  made  a  good  thing  out  of 


A   SPECULATOR    TURNED    DOWN         149 

it,  but  you  come  here  and  ask  me  to  help  you  to  do  the 
same  thing  again.  You  will  never  get  another  freehold  as 
long  as  I  am  minister." 

"One  man  one  run,"  was  another  watchword  with  which 
Minister  McKenzie  called  the  people  to  his  side.  Against 
the  system  by  which  thirteen  holders,  nine  of  them  com- 
panies, could  get  one  hundred  and  sixty-five  sheep  runs, 
one  company  having  twenty-five  of  them,  monopolising  all 
the  runs  in  a  district  and  keeping  every  one  else  out  of 
the  country,  he  instituted  the  system  of  "one  man  one  run." 
Under  this  no  one  could  get  more  than  one  run,  and  that 
only  of  a  moderate  size — a  great  boon,  he  said,  to  our  young 
men,  who  had  been  elbowed  away  hitherto  by  the  dummies 
of  the  great  monopolies. 

It  might  seem  at  the  first  glance  that  the  fact  that  the 
state  had  millions  of  acres  of  public  lands  which  it  was 
opening  to  settlement  was  a  good  reason  for  not  buying 
more  land  by  resuming  the  great  estates.  But  the  public 
lands  were  in  the  North  Island,  in  vast  forest  wastes,  far 
from  roads,  markets,  or  society.  It  would  take  a  long 
while  to  supply  this  territory  with  the  accessories  of  trade 
and  intercourse.  Land  already  broken  up  was  wanted  for 
immediate  use,  and  that  was  already  monopolised. 

A  very  desirable  class  of  immigrants,  the  farmers  of 
England,  were  entirely  unsuited  for  roughing  it  in  the  bush 
in  the  North  Island,  but  if  they  could  be  supplied  with  land 
already  cleared,  like  that  of  the  great  estates,  they  could 
begin  in  New  Zealand  where  they  left  off  in  England  and 
make  a  success  at  once  of  their  new  life. 

And,  then,  only  by  purchasing  land  could  the  common- 
wealth break  up  the  great  estates  and  get  rid  of  the  moral, 
political  and  economic  evils  that  attend  the  existence  of  these 
"social  pests."  The  subdivision  of  the  land  already  monop- 
olised was  a  necessity  of  New  Zealand  statesmanship. 


ISO         A  MAN  BETTER  THAN  A  SHEEP 

"The  more  you  subdivide  the  land,"  Minister  McKenzie 
said,  "the  more  you  increase  its  producing  power,  and  the 
revenue  of  the  country  will  be  correspondingly  increased." 

Premier  Ballance  put  the  same  consideration  foremost  in 
his  advocacy  of  the  policy  of  recovering  the  land  and  putting 
the  people  back  on  it. 

"There  is  nothing  which  will  conduce  more  to  the  pros- 
perity of  the  country  than  cutting  up  those  large  estates  and 
putting  people  on  the  land.  Then  they  will  be  prosperous, 
your  customs  revenue  will  increase  annually,  and  there  will 
be  no  more  unemployed  hanging  about  the  towns.  Increase 
the  number  of  your  estates,  make  easier  the  position  of 
the  producers,  and  you  will  multiply  the  energies  of  the 
colony." 

A  community  as  highly  financed  as  New  Zealand,  owing 
hundreds  of  millions  of  dollars  in  Europe,  has  need  to  be 
sensitive  about  anything  that  affects  the  taxpaying  power 
of  the  people. 

What  have  been  the  results  ? 

Up  to  the  end  of  the  fiscal  year  terminating  March  31, 
1899,  the  government  had  expended  in  the  resumption  of 
private  estates  $6,253,235,  and  had  added  to  this  $269,310 
for  surveys,  roads  and  other  costs  of  opening  them  for  set- 
tlement— a  total  of  $6,522,545.  This  is  a  sum  as  much  for 
New  Zealand  as  $600,000,000  would  be  for  the  United 
States.  For  this  sum  sixty-two  estates  have  been  acquired, 
with  an  area  of  256,829  acres.  Of  these,  218,485  acres 
had  been  let  March  31,  1899,  in  1304  holdings. 

There  are  now  living  on  this  land,  instead  of  the  sheep  and 
shepherds  who  were  once  their  principal  occupiers,  3077 
persons,  and  they  have  built  813  houses.  The  value  of  the 
improvements  which  have  been  made  is  $645,655.  The 
yearly  cost  of  this  investment  of  the  colony  in  the  in- 
terest it  is  paying  on  the  bonds  issued  for  the  purchase  is 


GLADSTONE'S   MISTAKE  151 


$212,438,  while  the  actual  rental  is  already  $288,735, 
some  of  the  lands  are  still  unlet. 

The  colony  gets  the  money  to  buy  by  borrowing  in  Lon- 
don at  three  and  one  fourth  per  cent,  and  less,  and  it  leases 
the  land  to  the  tenant  at  five.  At  the  date  of  the  report, 
March  31,  1899,  the  total  income  was  at  the  rate  of  4.8  per 
cent.,  and  enough  of  the  land  then  unlet  has  since  been  dis- 
posed of  to  bring  the  return  up  to  over  five  per  cent,  on  the 
capital  "sunk."  And  besides  this  direct  profit  is  to  be 
counted  the  indirect  —  vastly  more  important. 

The  New  Zealander  uses  his  national  credit  to  get 
money  in  London  to  lend  again  in  advances  to  settlers 
and  free  the  farmer  from  the  high  rates  of  interest  he  is 
paying  the  private  bankers,  and  in  precisely  the  same  way 
the  New  Zealander  gets  money  in  London  to  buy,  either 
with  or  without  the  owner's  consent,  the  great  sheep  runs, 
to  sell  them  at  cost  to  men  who  will  raise  food  and  families 
for  their  own  and  the  common  good. 

The  number  of  forfeitures  has  been  very  small,  and  most 
of  the  forfeited  sections  have  been  relet. 

The  land  report  for  1899  shows  that  the  total  number  of 
Crown  tenants  is  now  15,899,  holding  14,818,557  acres, 
and  paying  $1,331,765  a  year  rent,  and  of  this  only  $84,965 
is  in  arrears. 

Mr.  Gladstone  was  quoted  during  the  debate  on  the  New 
Zealand  land  bills  as  an  authority  against  the  ability  of  the 
state  to  play  the  role  of  landlord.  After  giving  his  opinion 
that  nationalisation  without  compensation  would  be  robbery, 
he  said,  "Nationalisation  of  the  land,  with  compensation, 
so  far  as  I  can  understand  it,  would  be  folly,  because  the 
state  is  not  qualified  to  exercise  the  functions  of  a  landlord. 
The  state  could  not  become  the  landlord;  it  would  over- 
burden and  break  down  the  state."  The  people  of  New 
Zealand  were  not  deterred  by  this  formidable  quotation. 


152         A  MAN  BETTER  THAN  A  SHEEP 

They  went  on  and  made  the  state  a  landlord,  with  results 
so  far  quite  the  opposite  of  these  predictions. 

Land  in  New  Zealand  is  being  distributed,  not  concen- 
trated. The  number  of  small  holdings  shows  a  steady 
increase,  though  not  yet  a  rapid  increase.  In  1895  the  num- 
ber of  holdings  had  been  46,676.  In  1899  there  were  62,- 
639  holdings  of  one  acre  and  upward,  an  increase  of  1880 
for  the  year.  Out  of  62,639  holdings,  36,932 — fifty-nine 
per  cent. — were  less  than  100  acres.  Only  10,959,  or  17*^ 
per  cent.,  hold  over  320  acres,  and  this,  it  must  be  remem- 
bered, includes  a  large  number  of  extensive  tracts  held 
under  pastoral  leases. 

In  1868  the  land  was  held  by  only  five  per  cent,  of  the 
people.  In  1888  the  percentage  of  land  holders  to  popula- 
tion was  only  one  half  per  cent,  better  than  it  had  been 
twenty  years  before.  To-day,  notwithstanding  the  growth 
of  population  and  of  industrial  pursuits,  two  per  cent,  more 
of  the  population  owns  land  than  in  1888. 

A  picturesque  translation  of  these  statistics  I  found  in 
a  letter  in  the  "Lyttleton  Times,"  contributed  by  "Jonn  in 
the  Bush." 

"The  dear -old  feudal  system  of  New  Zealand  is  gone — 
broken  up  by  a  ruthless  democracy. 

"I  have  stood  on  the  top  of  the  Blue  Mountains  of  Otago 
and  scanned  ten  mighty  baronies,  from  ten  to  one  hundred 
thousand  acres  each,  the  lord  of  which  had  power  of  'pot 
and  gallows'  in  those  days.  If  any  man  was  ever  sus- 
pected of  a  longing  for  an  acre  of  that  land  he  had  to  go 
and  get  his  teeth  pulled  out,  as  he  had  no  more  use  for 
them  in  that  little  town  by  the  mountain-side — a  town  of  re- 
tired sheep  inspectors  and  others  who  braved  the  ire  of  these 
potentates  and  were  reduced  to  sucking  wild  pigs. 

"The  scene  is  changed!     Climb  that  mountain  now  and 


LAST   OF  tHE  BARONS  153 

look  around.  In  place  of  the  wide,  rolling  waste  of  brown 
tussock  you  see  cultivated  fields,  homesteads,  schools, 
churches  and  villages,  and  roads  and  railways  winding 
everywhere.  Ay,  and  even  buggies  on  the  roads,  with  the 
gay  ribbons  of  the  settlers'  pretty  daughters  fluttering  in 
the  breeze.  That  plain  is  now  a  scene  of  life  and  bustle, 
with  its  pleasures  and  its  pains,  and  all  that  goes  to  make 
up  a  healthy,  a  happy  and  a  free  humanity.  It  was  worth  a 
fight  for,  and  King  Demos  has  won — and  the  barons,  the 
barons,  where  are  they?  One  is  left — only  one — and  he 
still  hangs  grimly  on  to  his  one  hundred  thousand  acres  of 
it,  and  still  marshals  his  squires  and  his  villeins  and  his 
serfs,  and  feeds  them  on  black  tea  and  damper  and  scraggy 
mutton,  as  of  yore."  j{ 

One  of  the  issues  put  to  the  fore  by  the  opposition  in  the 
recent  election  of  1899  was  tne  substitution  of  the  freehold 
for  the  leasehold.  The  Opposition  promised  the  people  that, 
if  elected,  it  would  allow  them  to  convert  their  state  lease- 
holds into  freeholds,  but  evidently  the  people  did  not  want 
the  privilege,  for  they  returned  the  Seddon  party  to  power 
with  a  larger  majority  in  Parliament  than  before.  "The 
end  of  the  freehold  system,"  Premier  Seddon  told  the  voters, 
"is  that  the  mortgagee  gets  the  farm,  and  the  farmers  get 
the  road.  If  we  repeal  the  leasehold  law  we  will  pre- 
vent the  poor  man  from  getting  any  land." 

Considering  that  the  lease  in  perpetuity  is  a  new  proposi- 
tion, and  that  it  has  to  compete  with  prepossessions  centu- 
ries old  in  favour  of  absolute  ownership,  the  leasehold  is 
gaining  public  favour  with  surprising  rapidity.  It  has  hap- 
pened that  lands  offered  with  the  right  of  purchase  have  re- 
mained unsold,  but  when  offered  again  under  leasehold  have 
been  applied  for  several  times  over.  Private  estates  offered 
in  freehold  have  gone  begging  for  purchasers,  while  at  the 


154         A  MAN  BETTER  THAN  A  SHEEP 

same  time  public  land  near  by  was  eagerly  taken  under 
leasehold. 

"The  state  as  a  landlord,"  Premier  Seddon  has  said,  "will 
be  more  liberal  than  the  money-lenders  who  foreclose." 
The  state  is  the  unique  sort  of  landlord  that  reduces  rent 
when  it  finds  itself  making  a  profit.  In  his  budget  speech 
in  1899  the  Premier  announced  that  out  of  its  gains  the 
state  was  able  to  lower  its  rents,  as  well  as  its  interest  on 
advances  to  settlers,  one  half  per  cent,  a  year,  or  one  tenth. 

In  a  speech  on  the  eve  of  the  election  of  1899,  the  Pre~ 
mier  said  that  there  had  not  been  a  single  penny  of  loss  on 
the  lands  bought,  and  the  rents  paid  gave  five  per  cent.  He 
promised  that  the  ministry  "would  borrow  more  money, 
buy  more  land,  and  put  their  sons  and  daughters  on  it." 

Still  more  radical  ideas  and  plans  are  fermenting  in  the 
New  Zealand  mind. 

The  Minister  of  Lands  has  declared  in  a  public  speech 
that  he  "would  like  to  see  the  time  when  all  the  lands  of 
New  Zealand  were  nationalised." 

And  Mr.  William  Rolleston,  the  most  authoritative  figure 
of  the  Conservatives,  certainly  as  regards  land  questions, 
said  during  the  last  campaign,  "We  shall  never  have  national 
prosperity  in  New  Zealand  until  we  nationalise  every  foot  of 
its  land." 

Minister  McKenzie  and  those  working  with  him  in  these 
reforms  saw  that  the  sale  of  land  simply  meant,  as  the  New 
Zealand  statistics  proved,  the  concentration  of  it  sooner  or 
later,  and  probably  sooner,  in  the  hands  of  a  few  men. 
When  the  Crown  sold  the  freehold,  it  surrendered  control 
and  could  neither  prevent  consolidation,  nor  insist  on  use. 
The  consolidation  of  the  land  then  was  inevitable;  the  only 
choice  was,  under  whom?  Should  the  people  become  a 
tenantry  under  the  money-lenders,  or  a  tenantry  under  the 
state?  What  was  needed  was  an  owner  who  would  not  do 


A   SIGNIFICANT   EPISODE  155 

the  cruel  and  uneconomic  things  which  the  private  owner 
did,  and  this  owner  Ballance,  Stout,  McKenzie,  Seddon, 
and  their  party  see  in  the  state. 

Both  in  the  land  and  fiscal  policy  of  New  Zealand,  since 
1891,  this  has  been  the  ruling  purpose — to  put  an  end  to 
"private  ownership"  of  land  in  the  old  sense  and  with  the 
old  immunity  from  social  control,  and  to  replace  it  by  a 
"private  ownership"  of  the  tenant  under  the  state  with  social 
control  for  social  advantage.  The  New  Zealanders  are 
well  on  the  way  to  the  realisation  of  what  no  people  have 
yet  had — an  inalienable  fatherland. 

The  example  of  New  Zealand  has  been  followed  by  sev- 
eral other  colonies.  Queensland,  South  Australia,  and 
West  Australia  have  each  an  act  for  the  resumption  of  pri- 
vate arable  lands,  and  the  Victorian  Parliament  has  re- 
cently passed  a  similar  measure,  but  no  results  of  much 
interest  have  been  achieved  in  these  colonies. 

A  bill  for  the  resumption  of  private  lands  was  introduced 
into  the  New  South  Wales  Parliament  in  1896,  but  was 
defeated  through  the  opposition  largely  of  the  labour  mem- 
bers. It  was  said  by  them  that  the  banks  and  mortgage 
companies  and  impecunious  or  designing  landowners  "would 
unload"  upon  the  state,  and  that  the  state  might  again  sell 
the  land  which  it  had  just  bought,  and  so  in  a  few  years 
have  the  same  curse  of  land  penury  and  be  asked  again  to 
practise  the  same  remedy,  and  thus  buying  to  resell  and  sell- 
ing to  rebuy  commit  the  endless  folly  of  legislating  in  a 
circle. 

Perhaps  no  episode  in  Australasian  history  more  vividly 
presents  the  fundamental  difference  between  Australian 
character  and  politics  and  New  Zealand  character  and  poli- 
tics than  this  success  in  New  Zealand  and  failure  in  New 
South  Wales. 

I  met  a  man  from  Savannah,  Georgia,  on  the  train  be- 


156         A  MAN  BETTER  THAN  A  SHEEP 

tween  Napierville  and  Woodville,  New  Zealand,  who  had 
been  thirty-four  years  in  the  country.  He  was  warm  in 
his  praises  of  his  adopted  home,  but  the  legislation,  especially 
the  land  legislation,  "was  rotten."  He  talked  on,  and  in  a 
few  minutes  revealed  the  reason  for  his  "conservatism." 
He  had  done  his  best  business,  he  said,  until  late  years,  "in 
little  spec's  in  land,  but  the  new  laws  had  killed  it  dead." 

One  of  the  leading  officials  in  the  Land  Department,  whose 
special  work  is  in  the  purchase  of  the  resumed  estates,  said 
to  me: 

"We  have  the  choice  of  all  the  large  estates  of  New  Zea- 
land. All  are  at  the  call  of  the  government.  No  man 
now  dreams  of  buying  a  large  estate  or  seeking  to  build  one 
up  to  leave  to  his  family.  All  that  is  a  thing  of  the  past. 
For  several  years  no  large  estate  has  been  sold  in  its  en- 
tirety in  Canterbury,  and  as  for  speculation,  that,  too,  is  a 
thing  of  the  past" — that  is,  speculation  in  farming  land. 
In  the  cities  dealings  in  "corner  lots"  are  still  popular. 

Freeholds  are  still  granted  in  New  Zealand,  if  the  pur- 
chaser of  public  land  so  elects;  large  amounts  of  land  are 
still  held  in  freehold,  but  the  determination  of  the  people 
as  expressed  in  their  present  policy  is  to  end  it  as  soon  as 
possible.  It  is  for  this  that  they  are  buying  back  the  large 
estates,  increasing  the  rate  of  taxation  the  landlord  pays 
as  the  number  of  his  acres  increase,  taking  a  larger  share 
of  the  larger  inheritances.  It  will  require  long  years  for 
this  policy  to  reach  its  consummation,  but  it  is  moving 
surely,  if  slowly,  toward  this  goal.  In  consequence  of  the 
laws  we  have  referred  to  and  public  opinion,  speculation  in 
land  in  New  Zealand  is  dead,  and  this  is  the  beginning  of 
the  end. 


CHAPTER  VIII 
"LANDLESS  MEN  HAVE  THE  PREFERENCE" 

THERE  is  a  place  in  New  Zealand  which  is  the  constant 
resort  of  a  steady  stream  of  visitors,  who  are  sometimes 
land  ministers  from  other  colonies,  or  economists  from  the 
Musee  Social  of  Paris,  or  other  varieties  of  the  "Democratic 
Traveller."  It  is  the  Cheviot  estate — the  first  that  was 
"resumed"  and  cut  up  into  small  farms  by  Minister  McKen- 
zie.  I  spent  two  days  there  in  the  height  of  the  New  Zea- 
land summer,  just  after  the  wheat  had  been  harvested. 
There  could  be  nowhere  a  fairer  sight  of  level  fields,  yellow 
with  stacks  of  grain  like  huge,  golden  beehives,  and  rolling 
hills  ribboned  with  vivid  green  stretches  of  turnip  fields 
in  which  the  sheep  were  soon  to  be  fattening.  Along  the 
west  ran  the  Lowry  Peaks,  to  the  east  is  the  Pacific  Ocean 
where  the  estate  had  a  harbour  of  its  own — Port  Robinson. 
Rivers  bound  it  on  the  south  and  north,  and  streams  run 
through  it  everywhere.  In  the  centre  is  the  village  named 
McKenzie  after  the  Minister  of  Lands.  It  is  only  five  years 
old,  and  has  hotels,  blacksmith  shops,  stores,  churches, 
schools  and  houses,  large  and  small,  arranged  along  the 
wide  streets  or  scattered  over  the  farms  and  garden  plots. 

On  a  commanding  position,  in  the  middle  of  a  noble  park, 
is  the  manor-house  of  the  late  owner,  still  the  property  of 
his  family,  as,  in  accordance  with  the  considerate  procedure 
of  the  government,  they  were  allowed  to  acquire  it  with  five 
thousand  acres  of  land  when  the  estate  was  resumed.  Sur- 

157 


158    LANDLESS   MEN   HAVE   PREFERENCE 

rounding  the  village  in  every  direction  the  eye  saw  farms 
with  comfortable  buildings,  well-stocked  and  cultivated. 

These  twelve  square  miles,  now  teeming  with  people  and 
prosperity  were,  until  1892,  the  home  of  but  one  family  with 
its  flocks  and  shepherds.  One  man  owned  as  far  as  he  could 
look,  from  the  mountains  to  the  sea,  and  from  river  to  river, 
and  there  was  but  one  house,  for  the  cottages  of  the  work- 
men hardly  deserved  that  name.  One  could  travel  miles 
and  miles  without  seeing  human  beings  or  a  habitation. 

It  was  a  lucky  accident  that  gave  Minister  McKenzie  the 
opportunity  to  make  this  demonstration  of  what  "closer  set- 
tlement" meant.  While  he  was  fighting  his  land  bills 
through  Parliament,  a  dispute  arose  between  the  Tax  Com- 
missioner and  the  trustees  of  this  beautiful  estate — whose 
owner  had  recently  died — as  to  the  valuation  on  which 
it  was  to  be  taxed.  Its  84,000  acres  were  assessed  at 
$1,524,630,  a  pretty  good  price  for  land  for  which  the 
owner  had  paid  five  shillings  an  acre  in  1853  and  sub- 
sequently. The  trustees  insisted  that  it  should  be  taxed 
for  no  more  than  $1,301,100.  There  were  very  few  estates 
in  the  colony  that  were  the  equal  of  this.  The  founder  of 
the  estate,  "Ready  Money"  Robinson,  as  he  was  significantly 
called,  had  made  very  extensive  and  thorough  improvements 
— good  buildings,  gardens  and  orchards,  magnificent  planta- 
tions of  pine  and  a  great  deal  of  fencing,  a  very  important 
item  in  New  Zealand.  Under  the  land  and  income  tax 
law  as  it  then  stood  in  New  Zealand,  in  the  case  of 
such  a  disagreement  as  to  the  assessment,  the  government 
had  the  power  to  take  the  property  at  the  owner's  valuation 
plus  ten  per  cent.  The  land  law  which  Minister  McKenzie 
got  through  Parliament  the  same  year  appropriated  only 
$250,000  for  the  purchase  of  estates,  but  here  was  a  chance 
to  try  his  experiment  on  land  costing  six  times  as  much,  and 
he  eagerly  took  advantage  of  it.  The  property  was  taken 


u 


LOOKING   FORWARD  159 

at  the  owners'  valuation — to  their  entire  satisfaction,  as 
they,  daughters  of  the  original  owner,  wanted  the  inherit- 
ance divided. 

The  Minister  of  Lands  went  to  work  to  make  his  disposal 
of  Cheviot  an  object  lesson.  The  purchase  was  made  profit- 
able at  once.  As  soon  as  the  department  received  the  title, 
it  leased  the  land,  agricultural  and  all,  for  grazing  for  the 
summer  while  it  was  preparing  the  estate  for  subdivision. 
By  this  means  a  revenue  of  three  and  two-fifths  per  cent, 
on  the  purchase  money  was  obtained  immediately,  to  the 
confusion  of  those  who  had  declared  that  no  government 
could  do  business  successfully  in  land.  The  estate  was  then 
resurveyed  into  agricultural  farms  of  from  50  to  100  acres, 
grazing  farms  of  from  500  to  3000  acres,  one  chief  town- 
ship and  three  villages.  Thirty  thousand  acres  were  de- 
voted to  these  farms.  Two  thousand  acres  in  the  vicinity 
of  the  town  site  at  the  centre  were  cut  up  into  suburban  lots 
and  garden  plots.  The  plan  of  the  new  community  pro- 
vided for  large  men  and  small  men,  men  with  capital  and 
men  without.  There  were  farms  for  agriculturists  with 
money,  lots  for  labourers,  and  the  farmers  and  the  labourers 
were  settled  side  by  side  for  mutual  advantage. 

The  future  was  looked  out  for  by  leaving  areas  at  all  junc- 
tions and  key  points  where  village  sites  were  likely  to  be 
needed  in  the  future. 

A  railway  line  was  also  surveyed  through  the  estate.  It 
was  laid  off  thus  early  in  order  that  the  colony  might 
not  have  to  buy  the  land  back  when  the  time  came  in  the 
future  for  the  construction  of  the  road. 

One  of  the  benefits  of  the  opening  of  lands  to  settle- 
ment is  that  it  gives  the  country  roads.  The  great  owners 
refused  to  make  roads;  they  preferred  to  close  up  their 
estates  all  around.  At  Cheviot  roads  were  now  made 
wherever  needed,  using  the  gravel  which  was  found  in  many 


160    LANDLESS   MEN   HAVE   PREFERENCE 

places  on  the  property.  A  passable  road  was  made  to  each 
section  offered  for  sale.  Cheviot  has  a  port  of  its  own, 
and  to  this  port  a  new  road  was  made  at  great  expense 
through  a  bluff  of  rock,  the  drive  along  which  vies  in  beauty 
with  the  celebrated  road  between  Sorrento  and  Amalfi.  All 
this  work  on  the  resurvey  and  improvement  of  the  estate, 
including  the  port,  cost  $320,000  in  addition  to  the  purchase 
money. 

The  Cheviot  settlement  was  an  immediate  success.  It 
was  not  until  November,  1893,  that  the  actual  transfer  of 
land  began,  and  in  six  months,  as  the  Minister  told  Par- 
liament, one  hundred  and  seventy-one  settlers  had  come 
in  and  were  living  on  their  property,  and  more  were  coming 
in  every  day.  These  settlers  had  one  hundred  and  ninety- 
one  children  with  them.  They  employed  twenty  other  peo- 
ple ;  there  were  ten  persons  in  business  who  employed  forty 
others;  there  were  one  hundred  and  sixty-three  labourers 
working — co-operatively,  as  is  the  New  Zealand  way — in 
making  roads  and  doing  the  other  work  of  getting  the  land 
ready  for  settlement.  The  hammer  sounded  all  day  long 
on  the  new  houses  that  were  being  built.  In  six  months 
five  hundred  and  sixty-nine  people  had  been  provided  there 
with  land  or  work.  Many  of  these  people  for  whom  a 
place  had  been  found  at  Cheviot,  the  minister  said,  would 
"otherwise  be  among  the  unemployed  in  Christchurch,  for 
whom  the  government  would  have  to  find  something  to  do, 
or  they  would  have  to  leave  the  country." 

Just  the  class  of  men  for  whom  the  "one  man  one  run" 
policy  had  been  adopted  came  in  here  to  take  advantage  of  it 
—young  men  with  some  capital,  $2500  to  $3000  or  more, 
who  had  been  unable  to  get  land  as  long  as  it  was  monopo- 
lised by  the  great  companies.  As  the  unpretentious  char- 
acter of  the  houses  shows,  they  did  not  spend  their  money 
on  expensive  building,  but  kept  it  to  put  into  the  best  of 


NO   SURRENDERS  161 

fencing  and  live  stock,  which  would  bring  them  in  an  im- 
mediate income. 

The  money  spent  for  the  improvement  of  the  estate  helped 
to  market  it  and  to  provide  the  very  best  kind  of  popula- 
tion to  live  on  it. 

In  the  first  year,  out  of  the  money  they  saved  more  than 
half  the  labourers  brought  in  to  make  roads,  build  bridges, 
etc.,  acquired  small  holdings  out  of  those  specially  pro- 
vided for  their  class,  put  up  houses  and  brought  in  their 
families.  Where  the  bullock  bell  used  to  be  the  only  sound 
in  the  old  days,  there  was  now  to  be  heard  the  school  bell, 
and  instead  of  the  sheep  of  old  hanging  on  to  tussocks  of 
grass,  were  now  to  be  seen  the  children  trooping  along 
the  road  on  their  way  to  school. 

The  experience  of  New  Zealand  does  not  sustain  the  idea 
so  widely  prevalent  that  city  people  and  artisans  cannot 
make  a  living  on  the  land.  Some  of  the  most  successful 
settlers  have  been  men  brought  up  as  tailors  or  shoemakers, 
and  workers  in  other  trades  in  the  city  of  London.  Sailors 
and  day  labourers  have  been  successful,  too. 

The  population  of  Cheviot  which,  in  1892,  consisted  of 
only  one  family  with  their  attendants,  had  increased,  in 
1898,  to  over  one  thousand,  and  is  still  larger  at  the  present 
time.  The  farms  have  been  eagerly  taken  up  and  the  rents 
were,  on  March  31,  1898,  paying  five  and  one  half  per  cent, 
on  the  net  cost.  This  then  stood  at  $1,312,145.  The  inter- 
est was  $44,330  a  year,  and  the  annual  rents  were  $72,500. 
The  amount  of  improvements  required  of  the  tenants  by  law 
was  $84,160,  but  the  actual  value  at  the  time  of  the  last  in- 
spection was  $247,690.  Out  of  a  total  rent  roll  of  $17,575 
a  year  from  236  leases,  there  were  only  19  settlers  in  arrears, 
with  rents  to  the  amount  of  $859.  There  were  4019  acres 
in  grain;  7374  in  green  and  root  crops,  and  11,430  in  Eng- 
lish grasses.  There  have  been  no  forfeitures  or  surrenders. 


162     LANDLESS   MEN   HAVE   PREFERENCE 

.In  going  about  this  place,  I  took  special  pains  to  find  out 
what  causes  of  dissatisfaction,  if  any,  there  might  be,  and 
what  the  shortcomings  were,  for  the  temptation  to  become 
enthusiastic  was  almost  overpowering.  There  were  some 
complaints  from  the  labourers  who  had  settled  on  the  small 
plots.  There  was  not  as  much  work  as  they  had  hoped 
for  from  neighbouring  farmers,  and  some  of  them  had  to  go 
away  from  home  to  get  it,  sometimes  for  six  months  at  a 
time.  I  found  the  labourers  more  fortunate  at  Momona, 
near  Dunedin,  where  are  fourteen  settlers  on  three  hun- 
dred acres,  almost  all  of  them  farm  labourers.  They  are 
surrounded  by  farmers  and  have  plenty  of  work.  Their 
wives  take  care  of  the  cows  and  the  milk  for  the  creamery, 
while  the  men  are  away  harvesting. 

We  met  a  Scotch  family  on  the  Cheviot  road,  a  wagon  full 
of  children  and  furniture,  bound  for  "home,"  returning  to 
Scotland  because  the  farmer  thought  he  could  do  better 
there  where  his  father  was.  But,  as  he  had  sold'  his  lease- 
hold for  a  handsome  advance,  before  he  had  even  ploughed 
it,  or  made  any  improvements  of  much  value,  he  could 
hardly  be  said  to  have  not  done  well  here. 

I  found  that  there  had  been  some  little  speculation  in  the 
properties  at  Cheviot  notwithstanding  the  great  pains  taken 
by  the  Minister  to  prevent  it.  Of  course  this  was  but  a 
bagatelle  in  comparison  with  the  speculation  that  would 
have  taken  place  in  a  settlement  under  private  auspices.  To 
check  this  speculation  as  much  as  possible  the  Minister  has 
so  far  refused  to  allow  settlers  to  acquire  adjoining  sections. 
He  has  established  this  rule  in  order  to  make  impossible 
any  such  consolidation  of  properties  as  it  is  his  whole  mis- 
sion to  prevent.  He  cannot,  of  course,  prevent  settlers  from 
selling  their  leaseholds  to  incoming  tenants  nor  would  he 
wish  to  reject  the  incoming  tenants  if  they  were  eligible. 

The  administration  is  criticised  because  the  work  on  the 


A   MISTAKE   CORRECTED  163 

roads  was  done  by  hand  and  had  required  the  presence  of 
hundreds  of  labourers,  whereas  it  could  have  been  done  at 
a  much  less  cost  and  with  a  small  number  of  men,  if  done 
by  machinery.  It  was  this,  I  was  told,  which  had  swelled 
the  cost  of  making  the  roads  to  the  high  figure  of  $320,000. 
The  government,  however;  could  easily  see  a  long  profit  to 
itself  in  the  employment  of  this  large  number  of  men.  It 
converted  many  of  them  into  permanent  settlers,  producing 
wealth  and  paying  taxes. 

A  thrifty  young  farmer,  who  occupied  one  of  the  most 
flourishing  places  in  the  settlement,  stretching  along  a  val- 
ley, and  just  out  from  under  the  shadow  of  the  moun- 
tains, told  me  that  many  men  at  Cheviot  were  eking  out 
a  bare  existence.  This  was  because  the  land  was  cut 
up  into  pieces  too  small  to  enable  the  farmer  to  make  a 
living.  There  are  men  who  get  along  only  by  violating 
the  rules  as  to  cropping  the  land.  The  complaint  was 
almost  universal,  I  found,  not  only  at  Cheviot,  but  in  other 
similar  settlements,  that  the  sections  were  too  small.  The 
ten-acre  sections  were  of  little  use  unless  near  a  large  settle- 
ment, and  not  then  unless  outside  employment  was  certain. 
Two-hundred-acre  sections  were  of  no  use  to  men  who 
wanted  to  raise  sheep,  and  were  no  more  than  a  living  to 
the  ordinary  farmer  in  New  Zealand  where  there  are  so  few 
cities,  and  where  so  much  of  the  produce  has  to  be  sold  for 
export  at  rates  fixed  by  international  competition.  This 
mistake  of  too  small  sections  was  due  to  a  natural  eager- 
ness to  find  homes  for  the  largest  possible  number  of  peo- 
ple. In  later  sub-divisions  the  farms  are  made  larger. 

However  I  found  no  lack  of  opinion  among  the  wiser 
farmers  that  what  was  wanted  was  not  so  much  more  land 
as  better  culture.  More  farmers  lose  money  by  having  too 
much  land  than  by  giving  the  land  they  have  too  much  at- 
tention. 


164    LANDLESS   MEN   HAVE   PREFERENCE 

A  now  prosperous  farmer,  who  was  for  years  employed 
on  the  estate  before  its  resumption  as  one  of  the  labourers, 
told  me  of  an  interview  which  took  place  one  day  between 
him  and  the  late  owner,  who  was  going  over  his  estate  with 
a  party  of  friends.  Meeting  his  man,  he  said  to  him,  "Bruce, 
would  you  not  like  to  have  a  piece  of  this  land?"  "Yes,  sir, 
indeed  I  would,  sir,"  the  man  replied.  "Well,  that  is  all 
you  will  ever  get  of  it,  Bruce,"  his  master  replied,  and  they 
all  laughed  and  went  on  their  way.  Bruce  now  holds  from 
the  government,  under  leasehold,  as  fine  a  farm  as  there  is 
in  New  Zealand,  on  the  very  spot  where  he  held  this  con- 
versation with  his  employer.  Last  year  he  threshed  out  an 
average  of  70  bushels  of  wheat  an  acre,  and  the  year  before 
68  bushels,  and  30  acres  averaged  80  bushels  to  the  acre. 
His  farm  is  190  acres.  With  land  like  that,  it  is  no  won- 
der that  Bruce  told  me,  almost  plaintively,  that  he  wanted 
"more  land." 

The  average  yield  of  wheat  last  year  on  the  Cheviot  estate 
was  45  bushels ;  of  oats  35  bushels,  an  average  of  less  than 
the  year  before  on  account  of  the  damage  done  by  the  cater- 
pillars, and  nl/2  acres  produced  1012  bushels  of  barley. 
The  Cheviot  settlers  have  an  association,  and  at  their  dinner 
in  June,  1899,  it  was  stated  that  one  settler  was  feeding  1400 
sheep  on  200  acres,  and  he  had  also  threshed  5000  bushels 
of  grain. 

A  member  of  the  Land  Board  told  of  land  in  the  Can- 
terbury District  for  which  $200  an  acre  had  been  paid  thirty 
years  ago,  which  is  still  producing  60  bushels  of  wheat 
to  the  acre  in  rotation  with  barley,  potatoes,  oats,  and  other 
crops,  with  little  fertilising  except  for  the  turnip  crop.  The 
soil  is  a  lime  wash  three  or  four  feet  deep  brought  down 
from  the  mountains. 

This  fertility  of  the  land  in  New  Zealand  is  one  reason 
for  the  high  price  which  it  brings.  Democracy  is  another 


REDEEMS   ITSELF  IN   TWENTY   YEARS   165 

reason.  There  is  no  cheap  land  in  New  Zealand.  Land  is 
more  productive  and  is  in  more  demand  where  the  number 
of  landowners  is  increasing  and  where  the  opportunity  to 
get  land  belongs  to  the  people  than  under  the  regime  of  large 
estates.  The  people  can  always  pay  more  for  land  than  the 
plutocracy,  if  they  have  the  opportunity. 

But  even  the  critics  of  the  minor  mistakes  made  by  the 
administration  in  the  disposal  of  this  estate  had  to  admit 
the  success  of  it  on  a  broad  view. 

"Any  one  at  Cheviot,"  said  one  of  the  grumblers,  "wish- 
ing to  sell  and  advertising,  would  get  a  dozen  answers  im- 
mediately. Cheviot  has  a  great  name." 

And  another  pointed  out  that  Cheviot,  at  the  present  rate, 
will  have  paid  for  itself  in  twenty  years.  "Since  it  is  so 
profitable  an  operation,  why  should  the  government  let  the 
great  number  of  people  who  want  land  go  hungry  for  it? 
Let  it  buy  more  and  give  everybody  enough." 

Those  who  are  living  in  the  town  are  doing  well.  The 
blacksmith's  hearty  wife  came  to  the  door  to  answer  our 
questions,  and  we  looked  with  admiration  upon  her  red- 
cheeked  daughter  who  was  driving  in  the  cow  at  the  gate. 
They  had  a  five-acre  piece  and  a  ten-acre  piece  and  a  thirty- 
five-acre  piece.  They  had  got  five  acres  at  auction  which, 
had  they  not  secured  it,  the  lady  said,  would  have  been 
used  "only  for  the  church,"  which  had  also  been  a  bidder. 

Along  the  drive  to  Port  Robinson  the  workmen  of  the 
port  have  places  of  thirty  to  forty  acres  with  cottages  bor- 
dering on  the  cliffs  hundreds  of  feet  high,  looking  out  over 
the  Pacific  and  its  rugged  and  picturesque  coast.  Gardens 
under  the  lee  of  the  bank  look  out  to  the  ocean  with  sloping 
sides  covered  with  fruit  trees  and  with  flats  luxuriant  with 
vegetables  and  flowers. 

The  greater  productiveness  of  the  close  settlement  over 
the  great  estate  is  easily  seen  at  Cheviot.  The  last  shipment 


1 66  LANDLESS  MEN  HAVE  PREFERENCE 

of  wool  for  the  late  owner,  "Ready  Money"  Robinson,  was 
2500  bales  worth  ten  pounds  a  bale,  or  $125,000.  In  the 
year  1898,  the  shipment  was  over  3000  bales,  in  addition  to 
which  nearly  4000  sacks  of  wheat  were  shipped,  and  a  large 
amount  of  other  products.  Over  25,0x30  fat  lambs  had 
been  sent  away  to  freezing  works,  and  20,000  fat  sheep  ex- 
ported. This  says  nothing  of  the  fact  that  the  estate  has, 
in  addition  to  this,  been  maintaining  its  population  of  over 
looo.  More  important  than  the  lambs  that  go  to  the  freez- 
ing works  are  the  "kiddies,"  who  will  live  and  if  need  be 
die  for  New  Zealand. 

One  of  the  officials  of  the  Land  Department,  an  expert 
valuer,  told  me  that  he  had  made  a  careful  calculation  of 
the  old  Cheviot  and  the  new,  and  had  compared  the  new 
Cheviot  with  some  of  the  large  private  estates  that  still 
exist  in  the  vicinity,  and  found  that  this  land  under  small 
ownership  and  agricultural  use,  instead  of  large  ownership 
and  pastoral  use,  had  gained  in  productive  power  fourteen 
times.  The  money  orders  issued  at  Cheviot  have  increased 
from  $1630  in  1891  to  $34,820  in  1899. 

A  man  who  acts  as  guide  to  the  wonders  of  the  geysers 
and  hot  pools  of  Wairakei,  raises  strawberries  and  lettuce 
every  month  of  the  year  in  the  earth  kept  hot  by  a  system 
of  steam-pipes  supplied  by  nature  herself.  He  has  three 
hundred  acres  of  government  land.  "It  gives  me  a  chance," 
was  his  laconic  summary  of  the  land  system  of  his 
country. 

Not  far  from  Cheviot  is  an  estate  which  has  a  different 
story  to  tell.  Its  owner  some  years  ago  undertook  to  sell 
off  his  land.  He  advertised  widely.  The  soil  is  fine,  and 
the  attendance  at  the  auction  was  large.  The  result  shows 
one  reason  why  people  in  New  Zealand  prefer  to  deal  with 
the  democracy  instead  of  the  private  speculator.  The  es- 
tate was  divided  into  town  lots  and  farms  surrounding 


AN  OUTSIDE  VIEW  167 

them.  The  lots  were  put  up  first.  After  the  town  lots  were 
sold  off,  the  owner  stopped  the  sale  of  the  agricultural  lands 
because  he  thought  it  was  not  bringing  in  enough.  The 
buyers  of  the  town  lots  had  bid  good  prices  because  they 
calculated  that  there  would  be  a  large  population  settled  on 
the  farms  round  about.  The  discontinuance  of  the  sale 
of  the  farms  left  these  purchasers  high  and  dry.  Many  of 
them  were  ruined  and  unable  to  make  the  second  and  third 
payments,  and  the  land  went  back  into  the  hands  of  the 
owner. 

When  Cheviot  was  first  offered  to  the  public,  some  of 
the  farms  were  put  up  to  be  sold  for  cash  in  fee  simple.  No 
one  wanted  them.  They  remained  unsold  at  a  considerable 
loss.  Finally  the  Land  Department  changed  the  conditions 
and  offered  them  under  leasehold  in  perpetuity,  and  they 
were  immediately  "rushed"  by  a  very  much  larger  number 
of  applicants  than  there  were  farms.  The  leaseholder  can 
keep  his  capital  to  use  in  his  farming.  He  cannot  be  fore- 
closed if  he  borrows  money,  and  if  he  leaves  or  is  unable 
to  pay  his  loan  he  is  certain  to  secure  the  full  value  of 
his  improvements.  The  leaseholder  cannot  borrow  on  the 
security  of  his  lease,  either  from  a  private  banker  or  from 
the  government.  Neither  can  he  borrow  ordinarily  from 
a  private  lender  on  the  security  of  his  improvements,  but 
the  Treasury,  through  the  Advances  to  Settlers  office, 
will  make  loans  on  such  security.  It  considers  a  man's 
good-will  and  his  improvements  good  loanable  security, 
and  stands  ready  to  lend  him  money  that  he  needs  and 
knows  how  to  use. 

The  colony  of  Victoria  last  year  sent  the  Honourable 
R.  W.  Best,  Minister  of  Lands,  and  W.  A.  Trenwith,  Mem- 
ber of  the  Legislative  Assembly,  to  New  Zealand  to  study 
its  land  and  labour  institutions  and  this  is  what  they  say  of 
Cheviot  in  their  official  report : 


1 68  LANDLESS  MEN  HAVE  PREFERENCE 

"While  proceeding  through  the  estate  we  saw  a  number 
of  neat  homesteads  on  agricultural  and  grazing  farms,  and 
everywhere  there  were  signs  of  comfort  and  prosperity. 
.  .  .  We  were  much  struck  with  the  comfortable  and 
neat  appearance  of  the  homesteads.  .  .  .  Most  of  the 
settlers  seemed  to  be  doing  well.  They  paid  their  thresh- 
ing-machine bills  generally  cash  down.  A  request  to 
hold  over  until  the  sale  of  the  crop  was  an  exception. 
.  .  .  Whereas  the  crops  under  the  contract  system,  when 
the  land  was  cultivated  in  its  unimproved  state,  yielded  only 
some  sixteen  to  nineteen  bushels  per  acre,  this  year  the  yields 
have  been  from  forty  to  sixty  bushels. 

"We  thus  completed  our  inspection  of  an  estate  which  six 
years  ago  was  nothing  short  of  a  great  sheep  walk  owned  by 
one  man,  who  at  most  employed  but  the  ordinary  station 
hands,  but  which  now,  studded  with  comfortable  home- 
steads, townships,  schools,  well-fenced  and  well-cultivated 
farms,  supports  a  population  of  upward  of  1200  persons. 
What  has  been  here  effected  by  the  government  of  New  Zea- 
land, receiving  interest  at  the  rate  of  five  and  one  half  per 
cent,  on  its  outlay  in  the  resumption  and  settlement  of  an 
estate,  is  very  reassuring  to  those  who  favour  any  well-con- 
trived system  of  closer  settlement." 

Wliile  Minister  McKenzie  was  proving  at  Cheviot  what 
could  be  done  with  "closer"  settlement,  Parliament  passed 
the  law  he  had  asked  for,  to  authorise  the  purchase  of  land. 
He  has  ever  since  1892  been  buying  estates  and  cutting 
them  up  into  smaller  places  along  the  lines  which  have  been 
so  successful  at  Cheviot.  Sometimes  he  acts  upon  petition, 
oftener,  on  his  own  motion. 

If  the  people  of  any  neighbourhood  find  themselves 
crowded  for  land,  they  may  petition  the  ministry  "to  re- 
sume" some  estate  near  by.  The  people  of  Ashburton,  for 


PUBLICANS   AND    PETITIONS  169 

instance,  needing  land  and  unable  to  buy  any  in  small  plots 
from  the  men  around  them,  sent  in  the  following: 

"ASHBURTON,  March  i,  1895. 
"THE  HONOURABLE  JOHN  MCKENZIE, 
Minister  of  Lands, 
Wellington. 

"We,  the  undersigned  electors  in  the  Ashburton  District, 
do  hereby  urgently  request  you  in  terms  of  the  powers  con- 
ferred upon  you  by  the  Land  Act,  to  set  apart  a  portion  of 
land  near  Ashburton  for  settlement. 

"And  your  petitioners  will  ever  pray,  etc." 

At  about  the  same  time  this  petition  was  presented — the 
coincidence  may  not  have  been  accidental — the  "High  Bank" 
estate,  about  10,000  acres  in  the  neighbourhood  of  Ash- 
burton, was  offered  by  the  owner.  It  was  inspected  by  the 
Board  of  Land  Purchase  Commissioners.  They  found  it 
to  be  all  level  land,  of  fine  quality,  and  only  three  miles  by 
good  roads  from  several  railway  stations,  and  recommended 
the  purchase.  Their  recommendation  was  adopted,  and 
the  price  offered  was  accepted  by  the  owner.  The  es- 
tate was  subdivided  into  forty-three  farms  of  50  to  639 
acres  each,  and  thirty-nine  smaller  pieces  for  village  set- 
tlements of  from  one  to  ten  acres  each.  The  farms  were 
all  applied  for  the  first  day  they  were  offered,  and  also  some 
of  the  smaller  sections. 

There  is  now  a  thriving  settlement  of  farmers  growing 
grain,  green  crops  and  fattening  sheep  and  cattle  where  for- 
merly only  one  man  was  in  occupation,  who  used  the  land 
chiefly  for  sheep. 

The  officials  of  the  Land  Department  do  not  take  these 
petitions  too  seriously.  Any  one  will  sign  a  petition.  The 
publicans  often  promote  petitions.  They  want  the  land 


1 70  LANDLESS  MEN  HAVE  PREFERENCE 

settled  to  increase  the  number  of  their  customers.  It  is 
noticed  that  the  men  who  sign  the  petitions  are  not  usually 
the  men  who  get  the  lands.  The  petitions  are  frequent, 
and  as  one  of  the  Land  Department  men  remarked,  "They 
are  usually  presented  in  connection  with  estates  that  are 
offered.  The  owner  sees  to  it  that  the  petition  is  circulated. 
But,  as  in  this  Ashburton  case,  the  petitions  may  represent 
a  genuine  demand  and  a  real  need,  and  then,  as  here,  they 
receive  the  attention  they  deserve." 

Owners  of  large  estates  generally  have  come  to  be  glad  to 
sell  to  the  government.  It  is  better  for  them  to  sell  to  it 
than  to  subdivide  themselves,  because  the  people  would 
rather  buy  of  the  government.  From  it  they  can  get  deben- 
tures which  yield  4^/2  per  cent,  on  the  value  of  the  farm, 
and  this  is  more  than  they  can  make  by  running  the  estate 
themselves. 

The  large  trust  companies  hold  many  estates  and  they 
want  to  realise.  Then  owners  sell  because  they  are  afraid 
of  the  graduated  tax.  Some  of  them  are  getting  old  and 
can  manage  money  more  easily  than  property,  and  the  heirs 
often  have  the  same  preference. 

One  of  the  finest  places  I  visited  in  New  Zealand  was  the 
estate  of  Elderslie,  a  few  miles  from  Oamaru.  A  large 
part  of  it  has  recently  been  purchased  for  "closer  settle- 
ment." On  our  way  thither  we  went  through  the  Teanaraki 
settlement  of  small  farmers  and  workingmen.  In  a  canvas 
hut  a  former  roustabout  was  living  on  ten  acres  of  land 
and  doing  well. 

"I  used  to  have  to  get  work  where  I  could  and  to  live  as 
best  I  might.  Now  I  can  keep  a  hack  in  the  paddock,  come 
and  go  when  I  like,  and  get  the  highest  wages.  The  rent 
is  high,  but  there  is  enough  in  that  field  to  pay  it." 

We  passed  from  the  canvas  hut  and  the  hardly  more  pre- 
tentious cottages  of  the  other  settlers  to  a  beautiful  mansion 


THE  SMALL   MAN    SURVIVES  171 

in  a  park  adorned  with  trees  brought  from  all  parts  of  the 
world — cedars  from  Lebanon,  firs  from  Colorado,  even  pines 
from  India.  The  estate  stretches  fifteen  miles  back  of  the 
house. 

The  proprietor  of  this  private  barony  retired  from  busi- 
ness with  a  fortune  at  the  age  of  forty,  bought  a  part  of  this 
property  from  the  Bank  of  New  Zealand,  added  to  it,  piece 
by  piece,  until  finally  he  had  many  thousands  of  acres.  He 
was  in  debt  $350,000,  which  he  had  borrowed  for  improve- 
ments. By  selling  11,000  acres  to  the  government  at 
$32.50  an  acre,  he  has  extinguished  his  debt.  He  keeps  his 
homestead  surrounded  by  gardens  as  beautiful  as  any  you 
will  see  in  the  heart  of  France.  His  sons  also  have  hand- 
some farms,  and  he  himself  retains  something  like  15,000 
acres. 

He  sold,  he  told  me,  because  it  was  very  difficult  to  farm 
on  so  large  a  scale.  There  was  a  great  risk  in  having  so 
much  land  under  one  or  two  crops.  The  small  farmer  could 
easily  keep  his  place  under  constant  cultivation,  under  his 
own  supervision,  and  would  have  a  greater  variety  of  crops. 
If  he  lost  on  one,  he  could  make  on  another.  In  other 
words,  this  gentleman  practically  admitted  that  the  political 
economy  of  the  small  cultivator  is  superior  to  that  of  the 
large  ones,  and  his  self-interest  works  more  accurately  and 
successfully  than  that  of  his  great  neighbours. 

This  gentleman  did  not  conceal  the  fact  that  the  pro- 
gressive land-tax  was  one  of  his  reasons  for  selling — not 
so  much  for  what  it  was,  as  for  what  it  might  be.  He 
said  this  with  the  air  of  conviction  of  the  large  landowner 
who  has  felt  the  tax.  He  was  evidently  in  a  very  cheer- 
ful state  of  mind  over  his  sale.  There  was  not  the  least 
suggestion  of  any  feeling  of  resentment  against  the  policy 
that  was  making  the  large  landowners  willing  to  allow  the 
community  to  become  their  best  customer. 


i;2  LANDLESS  MEN  HAVE  PREFERENCE 

Mr.  Charles  B.  Spahr,  in  his  investigation  of  bonanza 
farming  in  the  Northwest  given  in  the  "Outlook"  of  Novem- 
ber 4,  1899,  points  out  that  the  tendency  to  concentration 
has  been  reversed,  and  that  the  farms  are  being  split  up,  and 
in  the  "Outlook"  of  January  13,  1900,  the  same  tendency  is 
shown  to  exist  in  the  large  estates  of  Argentina. 

The  small  owner  is  competing  out  the  large  owner  in 
New  Zealand  agriculture  as  he  tends  to  in  other  parts  of 
the  world,  but  in  some  points  the  small  man  is  still  inferior. 
For  instance,  in  the  "closer  settlements"  the  small  men  pro- 
duce wool  of  inferior  quality,  as  they  cannot  afford  to  go  in 
for  animals  of  high  breeding.  This  they  will  have  to 
remedy  by  co-operation,  or  else  New  Zealand  will  have  to 
do  as  Victoria  has  done — set  up  a  government  stud. 

Not  far  from  Elderslie  is  the  Ardgowan  estate  of  4234 
acres,  which  the  government  took  by  condemnation  for 
$173,000  (£34,600)  and  has  cut  up  into  65  farms  and  plots 
ranging  from  5  to  364  acres,  and  rented  at  5  per  cent,  of  the 
cost  to  the  government;  or  from  $1.37  (5.?.  6d.)  to  $4  an 
acre  a  year  for  999  years. 

There  have  been  no  failures  among  the  tenants  on  the 
Ardgowan  estate  except  one,  and  he  was  the  most  capable 
of  them  all,  the  failure  being  due  solely  to  financial  reasons. 

One  of  the  settlers  here  was  a  woman  who  had  been  a 
domestic  in  Oamaru.  She  and  her  husband  now  had  fifteen 
acres  and  were  doing  well.  Her  father,  she  told  me,  had 
been  a  farmer.  "Land,"  she  added,  "runs  in  our  blood," 
but  some  of  it  I  saw  had  worked  through  to  the  outside. 

At  Tokorahi  among  the  settlers  were  men  who  had  been 
clerks,  farm  labourers,  etc.  Two  of  the  most  successful  had 
been  employed  in  a  bank. 

At  Maerawhenua  a  tall,  shrewd,  characteristic  specimen 
of  the  transplanted  Scotchman  told  me  how,  when  it  was  in 
the  hands  of  the  private  owner,  he  had  been  a  "cropper"  on 


HIGH  RENT  HIGH  DEATH-RATE          173 

the  land  he  now  holds.  The  government  gave  him  and  the 
other  croppers,  as  is  its  custom,  the  privilege  of  continuing 
on  the  land  they  occupied.  The  rent  under  the  private 
landlord  had  been  fifteen  shillings  an  acre.  Now  it  was 
only  ten  and  one  half.  A  neighbour  had  had  to  pay  fifteen 
shillings,  which  had  been  reduced  to  seven. 

"Why  does  the  government,"  I  asked,  "let  its  tenants  have 
the  land  for  so  much  less  than  the  private  landlord?"  "Be- 
cause the  government  wants  no  profit,"  was  the  reply. 

My  Scotchman  and  all  his  neighbours  were  doing  well. 
This  settlement  had  been  made  after  Cheviot  had  been  es- 
tablished, and  the  mistake  made  there  of  sections  too  small 
had  been  remedied  here. 

At  Roimata,  Pawaho,  Paparangi,  and  some  other  points 
near  Christchurch,  Lyttleton  and  Wellington,  may  be  seen 
settlements  which  the  government  has  started  in  order  to 
give  the  workmen  of  the  cities  homes  in  the  country.  The 
village  settlements  established  from  the  time  of  John  Bal- 
lance  down  to  the  present  day,  of  which  the  latest  examples 
are  to  be  seen  at  Cheviot  and  Waikakahi,  are  for  workmen, 
but  not  for  city  workmen.  But  the  land  policy  of  New 
Zealand  has  not  forgotten  the  need  of  suburban  homes  for 
urban  workers.  This  is  a  project  dear  to  Premier  Sed- 
don's  heart.  He  often  refers  to  the  huddled  quarters  of 
the  workingmen  in  Wellington  and  other  cities,  bunched 
up  under  the  hills,  with  a  death-rate  far  exceeding  that 
among  the  well-to-do.  "Their  high  rents  and  high  death- 
rate,"  he  says,  "make  them  slaves."  He  dwells  with  enthu- 
siasm upon  his  plans  for  taking  them  out  of  town  a  few 
miles,  giving  them  an  acre  or  two  of  ground,  with  frequent 
workmen's  trains,  and  rent  at  half  the  price  they  pay  in 
town. 

But  the  Land  Department  has  not  been  able  to  execute 
these  plans  with  the  success  that  has  attended  its  efforts  for 


174    LANDLESS   MEN   HAVE   PREFERENCE 

the  farmers'  sons.  This  has  been  partly  due  to  a  defect  in 
the  law,  which  gave  compulsory  powers  of  purchase  of 
estates  near  the  cities  only  when  they  were  of  five  hundred 
acres  or  more.  This  was  remedied  in  the  last  session  of 
Parliament.  For  the  purposes  of  providing  workmen's 
homes  the  government  may  now  compulsorily  take  land  in 
small  parcels  up  to  one  hundred  acres  in  towns  of  15,000 
inhabitants,  or  within  fifteen  miles  of  their  boundaries.  It 
is  only  by  compulsory  purchase  that  anything  can  be  done 
for  suburban  homes  for  workingmen.  Obviously  owners 
oi.  land  in  the  vicinity  of  the  cities  are  not  under  the  same 
economic  forces  making  them  willing  to  sell,  that  operate 
on  the  owners  of  large  estates  away  from  the  cities.  The 
only  way  to  get  their  land  at  a  fair  price  is  to  take  it  by 
condemnation. 

Another  difficulty  in  the  way  of  suburban  settlements  has 
been  the  inadequate  train  service,  but  this  has  now  been 
changed  for  the  better. 

The  workingmen  complain  that  the  requirements  as  to 
improvements  in  the  suburban  settlements  put  the  acqui- 
sition of  this  land  beyond  the  reach  of  most  of  them.  The 
workingman,  taking  one  of  these  plots,  must,  within  a  year, 
build  a  dwelling-house  worth  at  least  $150,  within  two 
years  must  build  such  a  fence  as  the  law  demands  around 
his  lot,  and,  within  three  years,  must  have  at  least  one 
quarter  of  his  land  fenced  off  and  under  proper  cultiva- 
tion as  a  garden  or  orchard.  These  requirements  imply 
possession  of  quite  a  little  capital. 

On  the  other  hand  the  government  will  advance  the  work- 
man, if  married,  $100  toward  the  cost  of  these  improve- 
ments, and,  if  a  bachelor,  $50. 

The  very  broad  definition  given  to  "workman"  by  the 
New  Zealand  law  is  another  reason  why  the  intention  that 
these  settlements  should  inure  especially  to  the  benefit  of 


NOT  WHAT  WE  CALL  WORKMEN        175 

the  artisan  class  has  not  been  realised.  A  "workman"  in 
New  Zealand,  according  to  the  law,  is  any  man  or  woman, 
twenty-one  years  old,  who  is  doing  manual,  clerical,  or 
other  work  for  pay,  and  is  worth  only  $750  or  less.  At 
the  settlements  which  I  visited  I  found  persons  of  almost  all 
classes  except  what  we  Americans  would  call  "workmen." 

Very  little  is  being  done  with  this  form  of  settlement 
now.  For  one  reason,  the  areas  have  been  too  small,  and 
there  has  been  much  disappointment  that  the  workingmen 
— in  the  artisan  sense — have  not  taken  more  advantage  of 
the  opportunities  offered  them.  Instead  of  being  taken  up 
by  them,  the  public  allotments  have  gone  into  the  posses- 
sions of  little  shopkeepers,  widows  with  a  little  money  and 
with  sons  who  were  working  at  a  distance,  people  who 
had  no  manual  occupation — not  by  the  real  workingmen 
for  whom  it  was  intended. 

Pawaho  was  opened  in  April,  1899,  five  miles  out  from 
Christchurch,  and  was  taken  up  immediately.  Twenty  fam- 
ilies are  now  living  there  on  pieces  of  land  varying  in  size 
from  half  an  acre  to  two  acres  and  a  half.  This  land  rents 
for  from  $4.50  to  $11.50  an  acre. 

At  Wharenui,  a  new  settlement  four  miles  from  Christ- 
church,  the  land  has  also  been  taken  up,  though  there  is  no 
tram  and  no  railroad  connection,  and  the  only  means  of  com- 
munication is  by  coach.  The  sections  here  are  of  one  to 
three  acres  and  rent  at  $17.50  an  acre. 

In  the  suburbs  of  the  uniquely  beautiful  city  of  Adelaide 
I  visited  the  "Homestead  Blocks"  which  are  to  be  found  near 
all  the  large  towns  of  South  Australia.  Here  workingmen, 
shopkeepers  and  other  persons  of  small  means  are  given 
a  chance  to  get  land  enough  for  a  homestead  and  a  good 
garden.  The  "Blocker  System,"  as  it  is  popularly  called, 
is  not  for  farmers.  They  can  get  land  under  the  land  act. 
It  is  for  those  for  whom  the  possession  and  cultivation  of 


176    LANDLESS   MEN   HAVE  PREFERENCE 

a  piece  of  good  land  are  not  the  main  business,  but  to 
whom  land  may  be  a  help,  and  when  other  occupation  fails 
possibly  their  salvation.  It  aims  to  decentralise  the  people 
out  of  the  cities  into  the  country,  and  its  motto  is,  "One 
family,  one  homestead." 

So  South  Australia  under  powers  of  compulsory  purchase, 
like  those  of  New  Zealand,  has  been  buying  back  land  from 
private  owners  around  the  cities  and  cutting  it  up  into  blocks 
of  one  to  five  acres  near  the  towns,  and  of  as  much  as 
thirty  acres  in  the  country. 

The  prices  the  colony  must  pay  are  high  of  course;  so 
high  that  for  the  last  year  or  two  it  has  bought  very  little 
for  these  settlements. 

The  blocks  are  leased,  not  sold,  and  the  tenants  must  pay 
five  per  cent,  on  the  cost.  This  makes  the  rent  average 
about  $6.30  an  acre  as  far  as  ten  miles  out  of  Adelaide. 

To  be  .eligible  the  "blocker"  must  be  one  who  makes  his 
living  by  his  own  labour ;  not  necessarily,  however,  what  we 
call  a  workingman.  After  the  tenant  has  made  improve- 
ments on  his  land  the  government  will  make  him  advances 
on  the  value  to  the  amount  of  $250.  As  one  of  the 
officers  expressed  it,  "If  a  man  has  the  walls  of  a 
house  up,  the  government  will  lend  him  money  to 
finish  it."  Less  liberal  than  New  Zealand,  South  Aus- 
tralia, in  case  of  forfeiture,  forfeits  the  improvement  as 
well  as  the  land. 

The  blocks  are  intentionally  made  too  small  to  furnish  the 
whole  living  of  the  occupant,  though  in  some  cases,  with  in- 
tensive culture,  the  holders  of  twenty-acre  blocks  have  been 
able  to  live  on  the  land  alone.  Owing  to  the  prohibitive 
prices  asked  for  land  by  owners  and  to  other  causes  the 
system  has  not  flourished.  During  the  last  year  there  were 
3692  acres  let  for  homesteads,  but  the  larger  total  of  4207 
acres  was  cancelled.  This  has  been  due  largely  to  terrible 


ONE   FAMILY   ONE   HOMESTEAD          177 

droughts  which  ruined  the  crops  of  the  "blockers,"  and  at 
the  same  time  made  the  outside  employment  which  might 
have  saved  them  very  scarce. 

The  blocks  I  saw  in  the  vicinity  of  Adelaide  were  many 
of  them  most  attractively  cultivated,  and  were  occupied  by 
a  very  desirable  class  of  people. 

The  advantages  of  this  system,  taking  people  out  of  the 
cities,  adding  the  healthiest  of  all  industries  to  the  reper- 
toire of  livelihoods,  giving  an  unfailing  resource  in  times 
when  other  resources  fail,  keeping  near  the  cities  a  supply 
of  the  best  kind  of  labour,  offering  a  new  chance  to  men  who 
might  otherwise  be  lost,  do  not  need  to  be  dwelt  upon. 

The  experiments  of  South  Australia  and  New  Zealand  in 
this  direction  of  suburban  allotment — not  quite  accurately 
called  workingmen's  settlements — though  in  the  right  di- 
rection, are  still  only  in  the  experimental  stage.  In  none  of 
the  colonies  could  this  form  of  settlement  be  considered  the 
success  which  in  New  Zealand  the  Improved  Farm  Settle- 
ments and  the  "closer  settlements"  as  at  Cheviot  certainly 
are.  The  enlarged  powers  to  acquire  land  in  and  near  the 
New  Zealand  cities,  given  by  the  last  Parliament,  will  soon 
produce  results,  and  these  should  be  important. 

That  there  is  a  growing  need  for  these  allotments  and 
that  the  workingmen  and  others  who  would  occupy  them 
can  make  profitable  use  of  the  land,  is  proved  by  the  rents 
which  private  landowners  are  able  to  exact  from  small  men 
in  the  neighbourhood  of  the  towns.  Seventeen  dollars  and 
a  half  to  twenty  dollars  an  acre  (£3.10  to  £4)  are  easily  got, 
for  instance,  in  the  neighbourhood  of  Christchurch,  New 
Zealand.  The  same  land  when  leased  in  farms  can  com- 
mand only  seven  and  a  half  to  ten  dollars  an  acre  (30^.  to 
4cw.).  By  virtue  of  being,  though  in  so  small  a  way,  cap- 
italists, the  farmer  pays  less  than  half  what  the  workingman 
who  has  no  capital  must  pay. 


1 78  LANDLESS  MEN  HAVE  PREFERENCE 

The  New  Zealand  democracy,  which  gives  the  ballot 
and  old-age  pensions  and  seats  in  Parliament  to  the  Maoris 
— and  even  this  year  a  place  in  the  Cabinet,  where  the  Hon- 
ourable James  Carroll,  a  Maori,  sits  as  Colonial  Secretary 
— does  not  leave  them  out  of  its  provision  of  lands  for  the 
landless.  A  special  investigation  by  Parliament,  beginning 
in  1893,  ascertained  that  there  were  4233  Maoris,  who  either 
had  no  land  at  all,  or  not  enough  to  live  on.  To  meet  their 
wants  an  area  of  169,289  acres  was  withdrawn  from  other 
settlement,  and  set  aside  for  the  landless  natives.  So  far 
2415  have  been  taken  care  of,  and  the  needs  of  1828  are 
being  attended  to. 

Co-operative  villages  have  especial  recognition  in  the  New 
Zealand  land  system.  Ordinarily  land  is  distributed  among 
the  applicants  by  ballot,  but  this  would  operate  as  a  bar  to 
the  acquisition  of  land  by  co-operative  associations  whose 
members  must,  of  course,  live  together.  To  meet  this  need 
the  government  has  devised  the  "Small  Farm  Association" 
settlement.  People  who  want  to  establish  a  co-operative 
village  do  not  have  to  go  into  competition  with  other  persons 
for  their  land.  They  need  not  go  to  the  ballot  box  for  their 
allotments,  with  the  certainty  of  being  scattered.  If  twelve 
or  more  people,  associating  themselves  together  for  mutual 
help,  make  application  to  the  Minister  of  Lands,  he  will 
allow  them  to  select,  subject  to  his  approval,  a  block  of  land 
of  not  more  than  11,000  acres,  provided  there  is  a  settler 
for  each'  200  acres  in  the  block.  No  one  can  hold  more 
than  320  acres.  This  land  is  held  under  the  999  years'  lease. 

These  settlements  have  been,  perhaps,  the  least  successful 
ventures  New  Zealand  has  made  in  the  disposal  of  its  land, 
but  the  failure  has  not  been  the  government's  but  the  set- 
tlers'. These  co-operative  associations  are  very  apt  to  have 
more  enthusiasm  than  experience.  "The  difficult  art  of  liv- 
ing together"  is  difficult,  as  we  know  from  George  Eliot, 


A  DIFFICULT  ART  179 

• 

when  only  two  attempt  to  practise  it.  The  results  of  co- 
operative experiments  in  living  and  working  together  in 
New  Zealand,  on  the  state  farm  to  be  spoken  of,  and  in 
South  Australia,  and  in  New  South  Wales,  show  that  very 
few  people  are  as  yet  ready  for  co-operative  life.  The  path 
to  the  larger  family  this  life  promises,  like  the  path  to  de- 
mocracy, is  a  long  and  weary  one,  though  it  is  one  from 
which  the  feet  of  the  people  will  never  turn  back.  These 
co-operative  associations,  in  their  eagerness,  have  taken  up 
too  much  land  and  have  not  chosen  it  wisely  as  to  situation, 
quality  of  soil,  etc.  In  the  year  1897-98  there  were  172 
forfeitures  and  surrenders  out  of  1204  holdings,  and  in  the 
next  year  there  were  116  more.  There  are  now  812  selec- 
tors in  these  co-operative  associations,  holding  142,666  acres, 
which,  with  all  the  failures  acknowledged,  is  still  an  inter- 
esting and  respectable  showing. 

The  state  sometimes  puts  its  rents  too  high.  The  pro- 
cedure for  reduction  is  cumbersome,  and  there  is  an  agita- 
tion for  "A  Fair  Rent"  bill.  Revaluation  is  possible  under 
the  present  system  only  upon  the  tenant's  abandoning  his 
land.  After  twelve  months  it  is  offered  again.  If  no  one 
bids  higher  than  the  value  charged  the  old  tenant  he  can  go 
in  again  at  a  reduced  rate.  A  tenant  in  such  a  case  could 
only  trust  the  magnanimity  of  his  neighbours  not  to  bid  to 
get  his  section,  but  few  men  care  to  risk  taking  a  lease  at 
a  price  at  which  a  former  tenant  could  not  make  ends  meet. 
Among  other  concessions,  the  law  provides  that  in  case  of 
natural  disaster  a  year's  rent  may  be  remitted,  but  not  to 
tenants  who  are  in  arrears. 

This  system  of  "closer  settlements"  is  not  the  creation 
of  an  individualistic  peasant  proprietorship  like  that  which 
exists  in  France,  and  such  as  is  aimed  at  in  Ireland  by  the  new 
policy  of  the  English  government,  but  a  collective  proprie- 
torship and  partnership  of  people  and  state.  In  New  Zea- 


1 8o  LANDLESS  MEN  HAVE  PREFERENCE 

land  the  state  is  interested  pecuniarily  in  the  rent,  and  there- 
fore has  a  pecuniary  interest  in  the  prosperity  of  the  tenant. 
It  must  weep  with  him  and  laugh  with  him.  It  is  compelled 
to  watch  out  for  his  welfare.  It  is  therefore  a  very  real 
public  self-interest  which  sets  the  state  to  furnishing  lime 
and  poultry  experts,  London  agents,  low  railroad  rates, 
free  cold  storage,  cheap  money  and  all  the  rest  that  we 
tell  of  in  "Government  &  Co.,  Unlimited." 

As  we  have  shown,  New  Zealand  is  making  a  profit  of 
five  per  cent,  on  its  investments  in  "land  for  the  people." 
There  are  different  plans  for  disposing  of  these  profits.  At 
the  end  of  the  year  1899  the  department  expected  to  have 
accumulated  profits  of  about  $100,000.  A  sinking  fund  is 
proposed  by  some;  another  plan  is  to  buy  a  farm  with  this 
money.  Then  the  government  could  say  to  the  people, 
"Here  is  a  farm  that  has  cost  you  nothing."  Its  profits  could 
in  turn  be  added  to  the  fund  for  purchasing  more  farms,  and 
thus  the  system  could  go  on  snow-balling  itself  into  larger 
and  larger  proportions. 

Part  of  the  profits  of  the  settlements  are  now  being  used 
on  public  works  in  their  vicinity  for  the  benefit  of  the  set- 
tlers whose  labour  has  created  the  profits.  Thus  at  Cheviot, 
the  Land  Department  appropriated  last  year  $15,000  of  its 
profits  for  roads  and  other  improvements,  and  is  likely  to 
appropriate  a  similar  sum  this  year.  Following  the  prece- 
dent of  using  the  profits  of  the  advances  to  settlers  to 
reduce  the  rates  of  interest,  the  profits  of  the  land  opera- 
tions might  also  be  used  to  reduce  rents  and  the  Premier 
has  promised  this  shall  be  done. 

I  had  the  opportunity  of  being  present  at  the  balloting  to 
distribute  among  the  people  applying  for  them  the  farms 
cut  out  of  a  valuable  property  which  has  been  "resumed" 
— the  Waikakahi  estate.  This  consists  of  47,320  acres 
in  South  Canterbury,  between  the  Waitaki  and  Waihao 


WHY   HE   SOLD  181 

rivers,  bordering,  like  Cheviot,  on  the  Pacific,  with  blue 
mountains  on  the  sky  line  on  the  other  side,  a  beautiful 
stretch  of  country  between  the  ocean  and  the  mountains,  fer- 
tile, rich  and  wholesome.  It  had  been  for  many  years  the 
property  of  a  great  sheep  raiser.  It  was  a  fine  tract  of  farm- 
ing country,  well  coated  with  dark  loam,  sometimes  three 
feet  deep,  and  traversed  by  numbers  of  streams  draining  the 
wide,  open  valleys.  There  are  rich  alluvial  flats  and  rolling 
downs.  The  land  was  "in  good  heart,"  as  it  had  not  been 
exhausted  by  cropping,  but  where  it  had  been  cultivated  the 
yield  had  been  something  extraordinary.  As  much  as  fifty 
to  seventy  bushels  of  wheat  and  120  bushels  of  oats  an  acre 
had  been  threshed  from  some  of  it.  There  are  three  railway 
stations  on  the  land  or  near  it. 

Its  owner,  who  had  been  a  poor  boy  in  the  western  High- 
lands of  Scotland,  came  to  New  Zealand  thirty-five  years 
ago,  and  bought  a  few  acres  at  ten  dollars  an  acre.  From 
the  profits  of  his  sheep-raising  he  bought  some  more  and 
kept  on  buying,  until  he  finally  found  himself  the  owner  of 
this  magnificent  estate  and  a  millionaire  in  thirty-five  years. 
He  sold  because,  as  he  said  to  one  of  the  officials,  "If  I 
don't  sell,  you  will  take  it  by-and-by." 

In  addition  to  this  estate  he  had  another  of  16,000  acres 
which  he  gave  to  his  nephew,  without  waiting  for  the  pro- 
gressive land-tax  and  the  progressive  duties  which  would 
have  been  levied  upon  his  death. 

The  price  paid  him  was  $1,600,000  for  47,000  acres, 
about  $34  an  acre.  The  owner  took  $1,250,000  of  this  sum 
in  debentures  running  for  ten  years,  paying  three  and 
three  fourths  per  cent,  interest.  The  balance  of  the  money 
is  got  from  the  Post-Office  Savings  Bank,  or  the  investment 
funds  of  the  Life  Insurance  Department,  or  from  the  Public 
Trustee.  The  owner  kept  the  homestead,  which,  according 
to  the  act,  he  has  a  prior  right  to.  In  this  way  the  govern- 


182     LANDLESS  MEN  HAVE  PREFERENCE 

ment  dispose  easily  and  profitably  of  a  part  of  the  property 
which  otherwise  might  become  a  burden. 

The  New  Zealand  newspapers  were  full  of  the  official 
advertisements  of  the  sale,  and  of  news  articles;  for  the 
distribution  of  such  an  estate  is  an  event.  The  ballot  was 
to  take  place  at  the  little  town  of  Waimate,  and  when  I 
arrived  I  found  the  hotels,  boarding-houses  and  private 
residences  filled  to  the  eaves  with  people  who  had 
come  to  submit  their  applications  to  the  scrutiny  of  the 
land  board,  and  to  witness  for  themselves  what  fate  would 
do  for  them  in  the  casting  of  the  lots.  Even  the  railway 
carriages  were  turned  into  sleeping  rooms. 

The  estate  had  been  divided  into  140  farms,  ranging  from 
45  to  1473  acres.  Of  these  126  were  offered  to  the  public 
on  lease  in  perpetuity  and  fourteen  were  offered  as  small 
grazing  grounds,  and  for  these  there  were  3242  applications 
from  813  different  applicants.  There  have  been  cases  where 
there  have  been  over  one  hundred  applicants  for  one  piece. 
For  thirty-nine  sections  in  another  settlement  there  were 
2500  applications.  Every  applicant,  besides  filing  the  for- 
mal paper  required  by  law,  has  to  appear  personally  before 
the  land  board  to  answer  any  further  questions  they  need  to 
ask  to  satisfy  themselves  that  he  has  the  money,  knowledge 
and  other  qualifications  which  so  dignified  a  person  as  a 
state  tenant  must  possess.  The  land  boards  had  been  sit- 
ting in  different  places  in  the  colony  for  several  weeks  to 
examine  intending  settlers,  but  a  number  were  still  to  come 
before  the  board  at  Waimate  on  the  eve  of  the  distribution. 
These  examinations  are  for  obvious  reasons  usually  private, 
but  the  board,  anxious  to  let  me  see  as  much  as  possible 
of  the  inner  workings  of  the  system,  and  knowing  that 
one  so  far  from  home  as  I  could  not  offend  the  suscepti- 
bilities of  the  applicants  under  the  fire  of  the  official  exami- 
nation, did  me  the  courtesy  to  allow  me  to  sit  with  them. 


NOT   MUCH   LIKE  OKLAHOMA  183 

The  land  board  met  in  one  of  the  ante-rooms  in  a  little 
white  court  house  of  Grecian  design,  on  the  main  street, 
and  the  court  room  itself  was  given  over  to  the  thronging 
crowd.  The  examination  took  place  at  night.  The  dingy 
court  room,  lighted  by  a  dull,  flaring  lamp,  was  filled  to 
the  doors  with  eager,  patient  faces.  It  was  a  plain  lot  of 
working  farmers  and  their  wives,  and  of  young  men  and 
young  women,  for  women  can  apply  for  land  on  their  own 
behalf.  There  were  also  villagers,  farm  labourers,  work- 
ers on  the  railroad,  constables,  shepherds  and  domestic  ser- 
vants. Brothers  and  sisters,  husbands  and  wives,  came  to- 
gether. Most  of  them  had  brought  their  lunch  to  carry 
them  through  the  long  hours  of  waiting. 

One  applicant  had  come  from  Queensland;  there  were 
some  from  the  North  Island;  one  from  Canada  had  been 
in  the  Mashonaland  war.  There  was  a  man  who  had 
been  in  land  rushes  in  America,  and,  guessing  my  nation- 
ality, he  said  to  me  as  I  went  past  him,  "This  is  not  much 
like  Oklahoma."  Every  applicant  had  already  submitted 
his  answers  to  the  formal  questions  put  by  the  government, 
and  which  I  copy  here  to  show  what  it  asks  those  whom  it 
may  admit  as  tenants  of  its  lands. 

1.  How  old  were  you  last  birthday? 

2.  What  means  (including  stock  and  agricultural  imple- 
ments or  machinery)  do  you  possess  for  stocking  and  cul- 
tivating the  land  and  erecting  suitable  buildings  thereon, 
and  what  is  the  total  value  thereof? 

3.  Have  you  means  sufficient,  in  your  estimation,  to  en- 
able you  to  profitably  work  the  land  and  fulfil  the  condi- 
tions of  the  lease?     If  not,  state  how  you  propose  to  do  so. 

4.  What  experience  have  you  had  in  cultivating  agricul- 
tural land  or  in  dairying? 

5.  What  is  your  present  occupation? 


1 84  LANDLESS  MEN  HAVE  PREFERENCE 

6.  Are  you  married?     If  so,  has  your  wife  (or  husband) 
had  any  experience  in  cultivating  land,  in  farm  work,  or  in 
dairying?     Give  particulars. 

7.  Have  you  any  family?     If  so,  state  the  number  and 
sex  of  your  children  now  living  with  you,  and  their  ages. 

8.  What  land  do  you  hold  or  have  any  interest  in? 

9.  What  land  does  your  wife  (or  husband)  hold,  or  have 
an  interest  in? 

10.  Is  the  rural  land  (if  any)  mentioned  in  answers  8 
and  9  insufficient  for  the  maintenance  of  yourself  and  your 
family?     If  so,  give  your  reasons. 

11.  Is  the  town  or  suburban  land  (if  any)  mentioned  in 
answers  8  and  9  insufficient  for  a  home  for  yourself  and 
your  family?     If  so,  give  your  reasons. 

The  conditions  as  to  residence  and  improvement  are  very 
strict.  The  successful  applicant,  to  hold  his  property,  must 
begin  residence  within  a  year,  and  within  a  year  must  put 
on  improvements  equal  to  two  and  one  half  per  cent,  of 
the  value  of  the  land,  and  within  another  year  two  and  one 
half  per  cent,  more,  and  within  the  next  four  years  another 
two  and  a  half  per  cent.  He  must  have  his  fields  fenced,  in 
accordance  with  the  stipulations  of  the  law,  within  two  years, 
He  must  once  a  year  cut  and  trim  all  the  hedges  on  his  land, 
and  must  also  keep  it  clear  of  all  broom,  sweet-briar  and 
other  noxious  plants.  He  must  not  take  more  than  three 
crops  from  the  same  land  in  succession,  and  one  of  these 
crops  must  be  a  root  crop.  After  the  third  crop  he  must 
put  the  land  down  in  grass,  and  let  it  remain  in  pasture  for 
at  least  three  years  before  beginning  to  crop  it  again.  If 
his  farm  is  more  than  twenty  acres  he  must  keep  not  less 
than  one  half  of  it  in  permanent  pasture.  He  is  not  al- 
lowed at  any  time  to  remove  from  the  land  nor  burn  any 
straw  which  is  grown  upon  it.  If  the  tenant  neglects  these 


THREE   DAIRYMAIDS  185 

and  some  other  less  important  conditions  the  land  com- 
missioner will  have  the  work  done  for  him,  and  the  cost  of 
it  is  made  recoverable  in  the  same  way  as  the  rent. 

Some  of  the  old-fashioned  people,  used  to  the  immunities 
of  the  freehold,  resent  the  inspections  of  their  premises 
necessary  to  ensure  their  compliance  with  the  terms  of  the 
leases.  "It  is  a  good  deal  like  being  at  school  again,"  one 
of  them  complained.  "The  Ranger"  is  the  title  of  the  in- 
spector of  leasehold  properties.  "If  you  find  the  Ranger 
in  your  garden,"  a  leaseholder  said  sarcastically,  "counting 
the  gooseberries  you  mustn't  mind  it.  It's  part  of  the 
system." 

The  women  were  called  in  first,  one  by  one,  from  the 
court  room  before  the  land  board.'  "We  should  deal  first 
with  the  women  who  are  waiting,"  the  chairman  said.  The 
first  woman  who  appeared  before  the  board,  after  answer- 
ing their  questions,  said,  "I  am  taking  this  up  entirely  for 
the  benefit  of  my  family  of  seven  children." 

The  next  was  a  domestic  who  had  eight  children.  She 
had  saved  and  made  $3000.  Her  father  came  in  on  his 
crutches  to  vouch  for  her.  Her  mother  and  two  sisters  were 
with  her.  The  three  girls  were  all  dairymaids,  and  all  were 
balloting  for  the  same  section  in  order  to  increase  the 
chances  that  some  one  of  the  family  might  get  it.  "Have 
you  any  other  land?"  the  father  was  asked.  "No,  except 
a  cemetery  lot  not  yet  occupied,"  he  replied. 

Two  sisters,  domestics,  applied  for  a  piece  for  which 
there  were  one  hundred  and  sixty  applicants.  They  had  en- 
tered, they  said,  to  give  their  father,  who  was  one  of  the 
applicants,  another  chance. 

A  husband  and  wife  were  applicants  for  the  same  section. 
"If  I  get  it,  it's  his,"  the  wife  said.  "If  he  gets  it,  it's 
mine." 

One  of  the  points  as  to  which  the  board  had  to  be  most 


1 86  LANDLESS  MEN  HAVE  PREFERENCE 

careful  in  its  search  was  that  the  applicant  was  not  already 
the  possessor  of  land,  for  here,  by  the  law,  "landless  men 
have  the  preference."  One  of  the  first  men  to  appear  had  a 
piece  of  land,  but  he  explained  to  the  board  that  it  was  the 
"worst  piece  on  the  Waikakahi  River.  I  have  to  go  out 
to  find  work  to  keep  it,  instead  of  its  keeping  me."  But 
the  board  was  inexorable.  "You  are  not  landless,"  they 
said.  "We  are  obliged  to  give  the  preference  to  the  land- 
less." "It  is  a  serious  thing  for  me,"  he  said,  and  heaved  a 
big  sigh  and  went  his  way. 

Tlie  next  applicant  held  one  hundred  and  sixty-eight  acres 
of  freehold.  "That  bars  you,"  the  board  said.  "You  are 
not  landless.  You  should  have  sold  your  land.  You  could 
then  have  had  a  chance." 

The  next  man  had  made  over  a  lease  of  some  land  he  held 
after  he  made  application.  He  was  barred.  "You  should 
have  been  free." 

The  next  had  sold  his  lease  to  take  effect  if  he  got  the 
section  he  applied  for.  If  he  did  not,  he  would  still  hold 
his  section.  "Ineligible." 

"I  have  been  working  on  the  land  all  my  life,"  said  the 
next  man,  "but  I  have  no  land."  There  was  an  extra 
touch  of  heartiness  in  the  "Ay"  with  which  the  land  board 
approved  his  application. 

"If  I  had  fifty  acres  of  good  land  I  would  be  all  right," 
said  the  next  man.  He  had  all  the  requirements  but  the 
land — knowledge,  experience  and  money,  or  its  equivalent. 
Each  applicant  must  have  five  dollars  in  cash,  or  its  equiva- 
lent, for  each  acre  for  which  he  applies.  As  to  his  resources, 
this  man  said  he  had  horses,  drays,  cows,  reapers,  binders. 
"Me  wife  has  thirty  pounds  in  the  post-office,  and  I  have 
forty  pounds  meself,  besides  me  furniture  and  an  acre  of 
potatoes." 

"I  put  in  my  application  for  the  largest  sized  piece  of 


A  THRIFTY  LABOURER  187 

land  I  thought  I  could  work  myself,"  said  one  of  the  men. 
The  board  thought  that  he  had  asked  for  more  than  he 
could  manage  and  cut  his  name  out  of  the  applicants  for 
large  sections,  but  allowed  him  to  remain  with  those  who 
were  balloting  for  a  smaller  section.  The  applicants  were 
allowed  to  apply  in  this  manner  for  more  than  one  section. 

One  man  withdrew  because  he  had  become  convinced  that 
he  had  not  money  enough  to  carry  on  the  section  he  had 
applied  for.  "There  is  a  great  deal  more  fencing  to  be 
done  than  I  thought." 

The  applicants  were  carefully  questioned  about  the 
amount  of  money  they  had  in  the  bank  or  some  other  safe 
place,  or  in  the  shape  of  some  equivalent.  Their  means 
may  be  part  in  cash,  part  in  animals;  unsold  crops  and 
wages  due  all  count  as  part  of  the  needed  funds.  There 
were  suspicions  that  some  men  had  qualified  themselves  to 
pass  the  examination  as  to  their  financial  resources  by  bor- 
rowing money  for  a  day  or  two.  There  was  plenty  of  talk 
about  men  who  got  the  use  of  a  hundred  pounds  for  two 
days  for  a  pound,  but  no  evidence  was  forthcoming.  "Any 
number  of  people  are  putting  money  in  the  bank  to  make  up 
the  amount.  If  I  had  known  it  I  could  have  done  it,  too," 
said  a  man  who  was  rejected  because  he  had  not  the  amount 
of  cash  the  board  required. 

"They  have  all  sworn,"  the  chairman  replied,  "that  it  was 
their  own.  They  will  probably  be  prosecuted  for  perjury. 
You  wouldn't  like  that?" 

The  village  constable  was  an  applicant.  If  successful  in 
the  ballot  he  proposed  to  resign  his  position.  He  had  $4200 
of  his  own  and  his  wife's,  the  savings  of  forty  years. 
Needless  to  say,  he  was  approved. 

One  of  the  farm  labourers  who  applied  and  was  approved 
had  $4500  to  his  credit.  "A  careful,  thrifty  man,"  the 
board  said  as  he  retired. 


i88    LANDLESS    MEN    HAVE    PREFERENCE 

"Where  did  you  get  your  money?"  the  board  asked  one. 
"Out  of  my  hard  earnings  at  work  I  saved  it  just  to  get 
such  a  piece  of  land  as  this  at  Waimate."  "Where  have 
you  kept  that  money?"  he  was  asked.  "In  my  pocket  and 
my  wife's,"  he  said.  No  banks  for  that  man.  He  was  a 
member  of  the  stocking  brigade. 

One  of  the  applicants  calculated  ten  acres  he  had  in  pota- 
toes as  worth  $1,250.  The  board  did  not  think  them  worth 
so  much  and  rejected  him  for  insufficiency  of  capital.  "I 
am  done,"  he  said. 

In  several  cases  husbands  and  wives  applied  independently 
for  sections.  As  the  distribution  is  made  by  ballot — wher- 
ever there  is  more  than  one  applicant  for  the  same  piece — 
they  are  not  likely  to  have  adjoining  sections,  and  no  ar- 
rangement is  possible  under  existing  regulations  by  which 
they  can  be  assured  sections  together.  And  each  has  to 
live  on  his  or  her  own  section.  This  sort  of  divorce  is  felt 
to  be  against  public  policy,  and  the  Premier  promises  to  sub- 
mit to  Parliament  an  amendment  giving  families  a  prefer- 
ence in  the  distribution,  so  that  husband  and  wife  may  get 
sections  together. 

A  plate  layer  on  the  railroad  and  a  brakeman  were  among 
those  examined.  "I  intend,"  the  latter  said,  "to  make  my 
home  on  it." 

Some  of  the  men  indulged  in  little  touches  of  humour. 
One,  asked  if  he  had  any  encumbrances,  said,  "Three 
children." 

A  labourer,  who  had  been  on  the  estate  for  twenty-four 
years,  had  as  his  substitute  for  cash  one  hundred  and  fifty 
sheep,  seven  horses,  some  cows  and  some  furniture.  "Any 
amount  of  money  I  want  I  can  get,"  he  said.  He  was  ap- 
proved. He  and  the  shepherd  who  came  next  and  who  had 
been  on  the  estate  for  thirty  years,  got  the  land  for  which 
they  applied — that  on  which  they  had  been  living — without 


A  SCRUTINEER  FROM  AMERICA          189 

having  to  run  the  chances  of  the  ballot.  The  law  gives  this 
preference  to  the  men  employed  on  the  estate,  to  enable 
them  to  save  their  homes.  Surveyors  are  instructed  to 
cut  up  the  estates  so  as  to  put  land  enough  with  these  homes 
to  give  a  living  to  the  occupant. 

A  brother  and  sister  came  in,  twenty-two  and  twenty-one 
years  old,  and  said  their  father  had  given  them  $1,500  to 
start  with.  The  father  was  called  in.  "Will  you  have  any 
interest  in  the  land?"  he  was  asked.  "No,  sir,  they  are  old 
enough  to  look  out  for  themselves,"  he  said.  Their  appli- 
cation was  approved. 

A  teacher  of  agriculture  applied.  "I  have  had  very  little 
experience  in  farming,"  he  confessed. 

"What  experience  have  you  had  ?"  was  asked  of  another. 
"I  have  spent  all  my  life  on  the  ground,"  was  the  answer. 
"Have  you  any  land?"  "No,  sir." 

It  was  an  orderly  crowd,  and  the  streets  of  the  town 
became  quiet  the  moment  the  board  adjourned.  The 
next  morning  at  the  appointed  hour  the  people  surged 
eagerly  into  the  court  room,  filling  the  doors  and  the  cor- 
ridors to  witness  the  balloting.  The  question  arose  who 
should  be  "scrutineer" — the  representative  of  the  applicants 
who  draws  the  ballots  bearing  the  fateful  numbers  and  an- 
nounces to  the  crowd  the  successful  number  in  the  case  of 
each  section.  Several  voices  said,  "Let  the  people  nomi- 
nate," and  by  acclamation  the  Democratic  Traveller  from 
America  was  chosen  as  scrutineer,  and  given  the  honour  of 
helping  the  fates  in  the  distribution  among  the  people  of 
one  of  the  finest  estates  that  has  been  resumed  by  the 
democracy.  Just  as  the  ballot  was  about  to  proceed  one 
of  the  land  board  arose  and  made  a  public  protest  against 
a  decision  of  the  board  the  night  before  in  the  case  of 
a  man  who  had  seven  children,  and  though  he  had  land 
found  it  insufficient  for  their  support  and  had  to  go  out 


LANDLESS  MEN  HAVE . PREFERENCE 

to  work  every  day  in  the  week.  The  board  had  decided 
that  it  could  not  consider  him  landless.  "It  is  not  justice," 
said  this  member  of  the  board.  "The  board  have  admitted 
men,"  he  declared,  "who  had  thousands  of  dollars'  worth 
of  land,  and  rejected  men  who  could  not  make  a  living 
on  the  pieces  they  had.  The  meaning  of  landless  under 
the  law,"  he  said,  "is  the  not  possessing  land  enough  to 
maintain  a  home.  I  deem  it  my  duty  to  protest  against 
the  proceedings." 

The  protest  was  unheeded;  the  action  of  the  board  was 
entirely  within  its  discretion,  and  the  people  seemed  con- 
fident that  it  had  good  reasons  for  the  exclusion. 

For  each  farm  to  be  balloted  for  there  was  a  sheet  on 
which  were  entered  the  names  of  all  the  applicants  for  it,  ar- 
ranged alphabetically  and  numbered  in  due  order  from  one 
onward.  The  clerk  of  the  board  read  aloud  the  name  and 
description  of  the  first  farm  to  be  contested  for.  The  great 
crowd  grew  still  with  excitement.  There  was  the  sharp 
clicking  of  the  ballots,  one  for  each  applicant,  and  bearing 
his  number,  as  they  were  thrown  into  the  ballot  box — "The 
little  hurdy-gurdy  that  tells  the  tale,"  as  one  of  the  bystand- 
ers said. 

The  scrutineer,  as  the  representative  of  the  people  and 
especially  of  the  applicants,  carefully  and  even  ostentatiously 
supervised  every  detail  of  the  placing  of  the  ballots  in  the 
box,  seeing  that  there  was  a  ballot  for  every  applicant  and 
that  the  box  was  properly  closed.  The  crank  was  turned, 
and  the  box,  with  the  ballots  rattling  inside  of  it,  revolved 
rapidly  to. mix  up  the  lots,  so  that  there  could  be  no  pos- 
sibility of  "fixing  the  returns."  The  scrutineer,  not  blind- 
folded, but  standing  with  his  back  to  the  box,  put  his  hand 
behind  him,  and,  praying  that  luck  might  favour  one  of  the 
red-cheeked  dairymaids  sitting  breathless  in  front,  drew 
forth  the  fateful  ballot,  and  held  it  up  in  front  in  full  view 


•7  * 


SHE   GOT   HER   FARM  191 

of  every  one  and  read  aloud  the  number  upon  it.  There- 
upon the  name  corresponding  to  the  number  was  given  out 
by  the  secretary  of  the  board  in  sonorous  tones.  If  the 
happy  recipient  had  friends  and  neighbours  present,  or  if 
he  was  a  man  generally  known,  the  announcement  of  his 
name  was  received  with  cheers. 

The  man  for  whom  the  scrutineer  drew  the  first  section 
was  most  enthusiastic.  He  came  to  the  scrutineer  after- 
ward and  insisted  upon  knowing  "the  name  and  American 
address  of  his  mascot."  "You  have  brought  me  great  luck," 
he  said,  "and  something  from  the  first  fruits  of  that  farm 
shall  be  yours."  There  is  still  time  for  the  arrival  of  those 
fruits. 

Part  way  down  the  list  the  scrutineer,  calling  out  the 
number  on  the  ballot  he  had  just  drawn,  saw  a  delighted 
flash  leap  over  the  face  of  one  of  the  eager  group  of  young 
women  in  front  of  him.  The  dairymaid  had  got  her  farm. 
"It  was  not  much  like  Oklahoma." 

This  little  paragraph,  which  I  cut  out  of  a  New  Zealand 
paper  in  November,  1899,  makes  perhaps  a  fitting  conclu- 
sion for  the  history  of  this  resumption  of  land. 

"During  the  last  year  more  houses  have  been  built  in  Wai- 
mate  than  in  the  preceding  ten  years.  Local  carpenters  can 
hardly  cope  with  the  demand.  Many  houses  are  in  course 
of  erection  at  Waikakahi  also." 


CHAPTER  IX 

TRAMPS    MADE    TAXPAYERS 

ALL  these  people  we  saw  balloting  at  Waikakahi  had  money 
and  experience.  What  is  there  in  New  Zealand  for  the 
man  who  has  no  land,  nor  money,  nor  work — the  unem- 
ployed, the  tramp?  New  Zealand  found  itself  face  to  face 
with  this  question  at  a  very  early  stage  of  its  history — 1874 
—when  its  national  life  was  hardly  a  generation  old. 
Though  too  new  a  country  then  to  have  any  right  to  such 
a  disease  of  national  old  age,  it  had  it,  as  a  result  of  both 
its  land  policy  and  the  public  works  policy  of  1870.  Part 
of  the  large  sums  borrowed  then  in  England  were  used  to 
assist  immigration.  Sir  Julius  Vogel  sent  word  to  the 
agent  general  in  London  to  find  and  forward  fifty  thousand 
immigrants  in  six  months.  They  began  coming  in  a  flood. 
Public  buildings  and  every  available  place  were  filled  with 
them.  It  was  the  policy  of  making  haste  to  be  rich.  One 
of  its  fruits  ripened  twenty  years  later  in  the  collapse  of 
the  Bank  of  New  Zealand. 

To  take  care  of  the  immigrants  they  were  put  at  work 
under  experienced  direction  on  blocks  of  Crown  land  from 
one  quarter  to  five  acres  in  area,  on  or  near  the  rail- 
roads. They  were  set  to  building  whares — the  Maori  word 
for  hut — of  sod.  No  one  knew  which  building  he  was  to 
occupy,  so  all  were  done  with  equal  care,  and  when  com- 
pleted they  were  balloted  for.  The  people  were  allowed 
to  occupy  these  huts  and  the  land  rent  free  for  the  first 

192 


ASSISTED   IMMIGRANTS  193 

year;  then  a  charge  was  made  of  fifty  cents  a  week  for 
three  or  four  years,  and  after  that  they  were  expected  to 
look  out  for  themselves. 

Among  other  reproductive  works,  the  men  in  these  early 
days  were  set  to  making  plantations  of  trees  which  are  now 
flourishing  groves  along  the  lines  of -the  railways. 

The  main  idea  of  the  scheme  was  to  give  temporary  re- 
lief, not  to  establish  permanent  settlements,  though  some 
of  them  still  survive,  as  at  Arowhenua.  The  Minister  of 
Lands  was  then  the  Honourable  William  Rolleston,  who 
has  been  a  notable  figure  in  New  Zealand  development.  At 
this  early  day,  in  answer  to  a  delegation  of  the  unemployed, 
Mr.  Rolleston  laid  out  a  complete  programme  of  village 
settlements  of  a  permanent  character,  with  help  from  the 
Treasury  in  building  homes,  but  he  belonged  to  the  wrong 
party — the  Conservatives — and  was  never  given  rein  to  re- 
alise his  ideas. 

At  Arowhenua  the  visitor  sees  snug  little  cottages,  bor- 
dering on  noiseless  turfy  streets  and  surrounded  by  a  won- 
derful profusion  of  flowers,  foliage  and  garden  products. 
Instead  of  fences  there  are  luxuriant  gorse  hedges.  Every 
foot  of  the  small  allotments  is  in  thrifty  use,  but  there  is 
always  along  the  walks  and  around  the  houses  room  for 
flowers.  These  places  have  all  become  freeholds,  as  the 
holders  were  allowed  to  purchase  them.  In  the  houses  we 
visited  the  husband  would  usually  be  found  away  from 
home,  busy  labouring  for  some  near-by  farmer  in  the  har- 
vest field. 

A  good  question  to  open  up  conversation  with  the  house- 
wives as  we  encountered  them  was,  "What  was  your  ship?" 
referring  to  the  vessel  in  which  they  had  arrived  from  Eng- 
land a  generation  before  as  assisted  immigrants.  The 
Lancashire  Witch,  The  Pyrrhus,  were  among  the  vessels  that 
these  women  remembered  gratefully.  The  sod  whares  still 


I94  TRAMPS  MADE  TAXPAYERS 

stand  on  some  of  the  lots,  but  most  of  them  have  been  re- 
placed by  wooden  cottages  of  attractive  appearance. 

One  of  the  settlers,  a  sturdy  Englishman,  of  Kent,  who 
has  been  on  his  present  place  for  eighteen  years,  had  been 
a  leader  of  a  union  of  agricultural  labourers  in  the  old 
country.  They  had  •  been  reduced  in  their  pay  by  the 
Farmers'  Union  from  twenty  shillings  a  week  to  fifteen, 
from  fourteen  shillings  to  twelve.  They  formed  a  Labour- 
ers' Union,  and  were  promptly  "locked  out."  The  invita- 
tion of  New  Zealand  coming  at  this  time,  this  man  and 
some  of  the  others  had  emigrated.  He  and  his  sturdy  wife 
had  no  children,  and,  he  said,  "no  need  to  want  them." 
He  would  have  preferred  to  stay  in  England,  he  told  me, 
but  he  had  to  leave  home  because  he  had  made  himself  a 
marked  man. 

A  couple  who  lived  in  a  house  near  by  had  been  twenty- 
five  years  in  possession  of  their  home  on  its  half  acre  of 
land.  They  had  seven  children,  all  doing  well.  This  man 
had  also  been  a  farm  labourer  in  England.  His  pay  had 
been  nine  or  ten  shillings  a  week.  He  could  not  make 
enough  there,  he  said,  to  get  food  to  eat.  "Being  a  labourer 
in  England  was  pretty  near  being  in  prison."  In  New  Zea- 
land he  has  a  beautiful  home,  all  his  children  have  lived 
and  are  prosperous. 

A  sailor  was  another  inhabitant  of  this  village.  Sailors 
are  frequently  among  the  successful  settlers  on  the  land  in 
New  Zealand.  The  life  of  a  sailor  makes  a  practical  man, 
one  who  is  able  to  turn  his  hand  to  anything.  At  a  settle- 
ment near  Christchurch  a  sailor,  who  was  adding  to  his 
already  commodious  home,  in  explaining  to  me  the  lack 
of  success  of  his  neighbours,  said,  with  emphatic  panto- 
mime, "They  lack  this,"  pointing  to  his  hand,  "and  they  lack 
that,"  pointing  to  his  head.  The  sailor  at  Arowhenua  had 
an  acre  of  land,  and  had  brought  up  two  children.  When 


WHAT  MILK   CAN   DO  195 

Cheviot  was  started  he  had  gone  there  to  work  at  one  of 
his  trades — that  of  horse-rug  making — but,  not  succeeding, 
had  returned. 

The  driver  who  was  taking  us  around  and  who  was  very 
much  interested  in  our  inquiries  remarked  to  me,  as  we  left 
this  place,  that  if  the  same  people  should  come  now  they 
would  not  do  so  well.  There  were  more  men  now,  he  said, 
than  work.  When  these  men  came  there  was  a  sad  need 
of  them  in  the  country,  and  they  were  in  sad  need  of  the 
work  it  had  to  give. 

One  of  the  lots  was  handsomely  improved  with  a  brick 
house  which  had  recently  been  sold  to  a  small  capitalist 
who  would  rent  it  out.  A  settler,  pointing  to  his  very 
attractive  home,  said,  "Milk  did  that."  He  had  been  a 
miner  in  Cornwall,  and  brought  over  five  children  whom 
he  "did  not  want  to  go  underground."  He  was  a  free,  not 
an  assisted  immigrant,  and  had  paid  $62.50  for  his  first 
quarter  acre.  His  house  cost  $2,000,  and  stands  in  effec- 
tive contrast  with  the  original  home  near  by. 

In  1886  the  towns  of  New  Zealand  were  again  filled  with 
workless  men.  This  led  the  Honourable  John  Ballance, 
then  Minister  of  Lands,  to  revive  the  idea  of  settling  the 
idle  labour  on  the  idle  land,  but  this  time  permanently,  not 
temporarily.  This  he  made  his  specialty.  It  was  a  scheme 
which  caught  the  eye  of  the  country  and  has  never  since 
been  allowed  to  die  out. 

Dromore  was  one  of  the  settlements  then  inaugurated. 
A  population  of  eighty-four  people  was  gathered  here. 
Nine  hundred  and  twenty-five  acres  of  Crown  lands  were 
selected  for  them — not  given,  but  rented.  Three  hundred 
dollars  was  advanced  them  to  build  houses.  In  four  years 
— 1891 — they  had  put  on  the  land  in  buildings  and  other 
permanent  improvements  $5785,  and  the  Treasury  had  re- 
ceived in  rents  and  interest  from  them  $1683.  The  arrears 


196  TRAMPS    MADE   TAXPAYERS 

were  nil.  The  state  had  given  these  men  and  their  families 
a  chance  to  better  themselves,  and  they  had  bettered  the 
country  as  well  as  themselves,  for  they  had  opened  up  the 
land,  improved  the  roads,  increased  the  public  revenue. 
Other  settlements  were  started,  and  money  was  advanced  to 
the  people  as  loans  to  help  them  to  fell  the  bush,  put  the 
land  into  grass,  and  establish  themselves  in  homes. 

These  subjects  of  economic  resuscitation  lose  none  of 
their  political  rights  and  none  of  their  consciousness  of 
them.  The  settlers  at  Eketahuna  took  timely  advantage  of 
the  presence  of  the  Minister  for  Public  Works  and  members 
of  Parliament  on  their  electioneering  tour  last  year  to  call 
their  attention  to  the  fact  that  they  had  to  go  twenty-eight 
miles  to  market  and  the  post-office,  although  there  was  a 
town  within  five  miles  of  them,  but  inaccessible  for  want  of 
proper  roads.  Ministers  have  their  "ears  to  the  ground" 
at  election  time,  and  the  settlers  received  a  promise  that 
"during  the  next  session  they  would  be  attended  to." 

"A  delegation  of  workingmen  is  always  sure  of  a  hear- 
ing with  the  minister,"  said  one  of  his  officers.  "Very 
likely  some  of  them  knew  him  when  he  was  a  workingman 
himself." 

Premier  Ballance  began  the  crusade  against  the  freehold 
which  Minister  McKenzie  afterward  carried  out,  and  he 
withheld  from  these  settlers  the  right  to  part  with  their 
lands.  The  men  and  women  with  their  children  thus 
planted  on  the  land  can  be  seen  healthy  and  contented  and 
in  happy  homes.  The  experiment  has  stood  even  the  finan- 
cial test,  for  the  Treasury  has  made  money  by  the  venture. 
Times  improved,  and  between  1887  and  I&91  no  new  vil- 
lage settlements  were  formed,  but  in  the  '90*5  hard  times 
came  again,  and  New  Zealand  heard  the  bitterest  cry  of 
the  modern  world,  that  of  men  and  women  who  want  work, 
asking  in  vain  to  serve  and  be  served. 


NOT   THE   SOUP   KITCHEN   IDEA         197 

In  his  report  for  1895  the  Secretary  of  the  Labour  De- 
partment of  New  Zealand  wrote  in  as  anxious  a  strain  as 
if  he  had  been  at  the  head  of  the  same  department  of  any 
of  the  effete  nations  of  the  world. 

"There  is,"  he  said,  "an  unusual  depression  in  the  labour 
market  and  a  corresponding  difficulty  in  finding  employ- 
ment. This  year  the  difficulty  of  providing  for  the  floating 
bodies  of  workmen  has  been  augmented  by  the  addition  to 
their  numbers,  and  many  settlers  and  others  hitherto  belong- 
ing to  permanent  labourers  here,  under  the  pressure  of  the 
scarcity  of  money,  have  recruited  the  ranks  of  the  wanderers 
by  helping  to  swell  the  number  of  the  unemployed.  The 
skilled  trades  have  also  contributed  their  quota,  boiler  mak- 
ers, printers,  painters,  etc.,  stepping  down  into  the  ranks  of 
untrained  labour  for  the  sake  of  employment  on  road  works 
or  railway  construction." 

In  May,  1899,  while  I  was  in  New  Zealand,  there  were 
many  complaints  made  against  the  government  from  more* 
than  one  place,  and  public  meetings  were  held  to  protest 
against  its  action  in  sending  the  unemployed  from  other 
parts  of  the  colony  to  the  public  works  in  localities  where 
the  residents  were  themselves  out  of  work.  In  one  such 
place  where  twenty  of  the  unemployed  from  Wellington  had 
been  sent  to  work  on  the  railroads  the  representative  of  the 
district  in  Parliament  wrote  to  the  Premier  that  the  names 
of  fifty  of  his  constituents  out  of  work  were  on  the  register 
of  the  labour  bureau  awajting  the  promise  that  they  would 
be  given  something  to  do.  He  said : 

"The  labourers  here  have  waited  patiently  for  work. 
They  are  now  disappointed.  These  men  are  very  near  to 
starvation." 

The  New  Zealand  idea  is  not  to  relieve  the  tramp  or  the 
unemployed  temporarily  with  soup  kitchens,  street  cleaning 
or  potato  patches,  but  to  make  a  citizen  and  taxpayer  of 


198  TRAMPS    MADE   TAXPAYERS 

him  permanently.  He  needs  money,  land,  work,  instruc- 
tion, and  the  touch  of  a  helping  hand,  and  the  democracy 
of  New  Zealand  has  been  for  many  years  attempting  to 
perfect  a  system  which  it  is  hoped  will  give  him  a  chance 
to  get  all  of  these.  This  policy  we  have  seen  developing, 
step  by  step,  from  the  settlements  of  Rolleston  to  the  vil- 
lage homes  of  Ballance,  and  it  has  been  taken  up  and  car- 
ried a  good  step  farther  by  their  successor,  Minister  McKen- 
zie.  The  public  gives  nothing  but  the  chance.  It  will  help 
the  man,  if  he  will  help  himself.  He  must  pay  ultimately 
for  everything.  There  is  not  a  touch  of  charity.  Not  even 
in  the  helping  hand.  For  the  man  who  is  saved  from  sink- 
ing by  this  hand  of  the  democracy  is  himself  a  member  of 
the  democracy.  With  his  very  first  stroke  of  work  he 
begins  to  strengthen  the  democracy  to  help  some  one  else. 
With  that  first  stroke  he  begins  to  be  a  taxpayer;  what  he 
receives  he  gives,  and  this  is  the  golden  rule  of  democracy — 
ithe  reciprocity  which  our  clumsy  language  calls  equality. 

In  this  policy  New  Zealand  sought  to  avoid  some  funda- 
mental mistakes  in  the  management  of  the  Australian  labour 
bureaus  for  the  unemployed.  These  gave  the  men  food  and 
shelter.  The  instantaneous  result  of  this  was  to  clear  all 
the  bush  country  and  the  sheep  runs  and  the  roads  in  Aus- 
tralia of  the  "swaggers"  and  "sun-downers"  who  were 
tramping  for  a  living  there.  These  men  asked  for  nothing 
in  the  world  better  than  food  and  shelter,  with  the  climate 
of  Australia  thrown  in.  Three  thousand  were  being  fed  in 
Sydney  alone  at  one  time. 

An  official  of  the  Land  Department,  Mr.  J.  E.  March, 
who  was  sent  to  investigate  by  the  New  Zealand  govern- 
ment, on  landing  in  Sydney  saw  nearly  one  thousand  men 
at  work  levelling  sand  in  one  of  the  parks  for  their  food. 
A  pair  of  horses  and  a  scraper  would  do  more  work  in  one 
day  than  these  hundreds  of  men  could  do  in  two  days,  and 


NEVER  GAVE   SIXPENCE  199 

the  men  knew  it.  He  saw  as  many  men  outside  the  labour 
bureau  seeking  employment,  which  they  could  not  get.  There 
was  plenty  of  land  in  New  South  Wales  suitable  for  settle- 
ment. Just  outside  the  city  was  some  very  good  coun- 
try admirably  adapted  for  small  settlements.  Sheep  were 
its  only  tenants.  A  large  army  of  able-bodied  men  were 
doing  fictitious  work  for  their  food,  with  a  larger  army  at 
the  labour  bureau  seeking  work,  while  on  the  land  that 
would  have  supported  them  and  their  families  and  thou- 
sands more,  roamed  a  few  flocks. 

Another  mistake  made  by  the  Australian  bureaus  had 
been  to  send  men  to  employers  who  had  labour  enough 
in  their  vicinity,  but  wanted  to  put  down  its  price.  If 
the  home  labourers  refused  to  accept  reduced  wages  the 
Australian  landowner  would  telegraph  the  labour  bureau 
to  send  him  men,  and  in  this  way  the  state  was  actually 
being  used  as  an  instrument  to  undercut  the  standard  of 
life  of  its  own  citizens.  The  abuses  which  resulted  from 
these  errors  of  management  absolutely  stank  in  the  nostrils 
of  the  whole  community. 

"In  New  Zealand  we  never  gave  sixpence,"  said  Mr.  Ed- 
ward Tregear,  the  secretary  of  the  labour  bureau,  "nor 
shelter,  nor  even  railroad  fare.  We  often  advanced  the 
railroad  fares  for  workmen,  and  even  for  their  families, 
but  it  must  be  repaid,  and  is  retained  from  the  man's  wages." 

Three  departments  are  co-operating  in  New  Zealand  in 
this  work  of  turning  tramps  into  taxpayers — the  Depart- 
ment of  Public  Works,  the  Labour  Department  and  the 
Land  Department.  The  last,  in  New  Zealand,  can  give 
these  men  all  three,  of  the  things  they  want — land,  work 
and  money. 

Items  like  this  from  the  "Wellington  Times"  are  common 
in  the  New  Zealand  newspapers : 

"The  Auckland  agent  of  the  labour  bureau  has  received 


200  TRAMPS   MADE  TAXPAYERS 

instructions  to  forward  an  additional  party  of  twelve  suit- 
able workmen  to  the  Poro-o-tarao-Ohinemoa  section  of  the 
North  Island  Trunk  Railway.  Applications  from  men  al- 
ready on  the  books  will  be  received  at  the  office  of  the  bureau 
until  noon  to-morrow." 

The  Labour  Department,  through  the  register  it  keeps 
of  the  needs  of  employers  and  employes,  and  through  its 
connection  with  the  various  departments — the  largest  em- 
ployers— can  find  work  if  any  one  can.  The  Land  Depart- 
ment has  charge  of  the  new  country  roads,  and  the  Public 
Works  Department  has  railroads  and  bridges  and  other 
public  works  always  under  construction.  A  man  is  sent  to 
a  private  or  public  employer,  as  the  case  may  be.  The 
work  may  be  at  the  other  end  of  the  colony,  and  he  may  not 
have  a  cent  to  pay  his  fare  nor  to  live  upon  while  going 
there,  but  that  is  no  obstacle.  The  Labour  Department 
advances  him  transportation  and  even  subsistence — ad- 
vances, does  not  give.  If  the  work  promises  to  be  perma- 
nent it  advances  him  transportation  for  his  family.  It  will 
give  him  and  them  orders  for  meals  and  beds  during  their 
journey.  The  cost  of  this  is  to  be  repaid  by  the  man  out 
of  his  earnings,  and  the  records  of  the  experiment  show 
but  a  trifling  percentage  of  loss.  It  is  the  policy  of  New 
Zealand  to  keep  the  families  of  workingmen  together  wher- 
ever possible. 

With  the  same  purpose  the  men  put  on  a  piece  of  work 
are  not  displaced  to  give  work  to  others,  so  that  "all  may 
have  a  chance."  The  chances  for  the  other  men  must  be 
found  elsewhere.  The  men  on  a  job  stay  there  until  it  is 
done.  Near  almost  all  the  public  works  one  sees  the  cot- 
tages, comfortable,  primitive,  to  which  unemployed  men  who 
are  working  for  the  public  have  been  assisted  to  bring  their 
wives  and  children.  Given  this  inch,  they  want  an  ell- 
whole  acres,  in  fact— and  a  definite  proportion  of  them  look 


Families  are  Kept  Together. 


t 


Waste  Labour  applied  to  Waste  Forest. 


(Page  204.) 


KEEP  THE  FAMILY  TOGETHER    201 

up  land  near  by  and  become  permanent  settlers  on  Crown 
lands  if  possible.  They  and  their  families  acquire  a  love  of 
the  country,  and  are  glad  to  leave  the  city  forever.  A  steady 
transfer  of  people  from  the  poorer  town  districts  to  the 
country  is  being  thus  accomplished.  'Many  who  do  not 
wish  to  devote  themselves  wholly  to  farming  take  small 
sections  of  land  in  the  vicinity  of  their  work.  When  their 
employment  on  the  railroads  or  other  public  works  has  come 
to  an  end  these  men  find  something  to  do  in  the  towns 
that  spring  up,  and  this,  with  their  own  little  piece  of  land, 
keeps  them  going.  A  great  deal  of  pains  is  taken  to  put 
these  unemployed  men  at  work  where  there  is  land  to  be 
had,  and  they  are  allowed — taught,  in  fact — to  work  alter- 
nately for  themselves  and  the  government.  Roads  are  made 
to  open  lands,  and  lands  are  opened  to  create  a  demand  for 
roads.  Estates  like  Cheviot  are  cut  up  not  simply  to  pro- 
vide farms  for  the  sons  and  daughters  of  the  older  settlers, 
but  to  place  by  their  side — partly  to  give  them  a  supply 
of  labour  at  harvest  time — unemployed  labour,  agricultural 
and  artisan,  in  village  settlements.  We  see  in  our  picture 
of  Cheviot  the  cottages  of  these  labourers,  who,  but  for 
this  chance,  might  still  be  standing  eleven  or  twelve  hours 
in  the  market-place  of  the  cities,  saying,  "No  man  hath 
hired  us." 

If  a  man's  family  for  any  reason  does  not  go  with  him 
the  department  makes  it  part  of  the  contract  that  it  shall 
retain  one  half  of  his  wages,  which  is  transmitted  by  means 
of  postal  notes  by  the  paymaster  of  the  works  to  "the  folks 
at  home."  In  the  first  six  months  of  its  existence  three 
hundred  of  the  unemployed,  assisted  by  the  labour  bureau, 
remitted  through  it  to  their  wives  and  families  no  less  a 
sum  than  $40,000. 

If  no  private  employer  wants  his  services,  the  unem- 
ployed man  in  New  Zealand  can  be  sent  to  the  state  farm 


202  TRAMPS    MADE   TAXPAYERS 

at  Levin  to  be  taught  the  use  of  the  axe  and  the  spade,  and 
to  work  co-operatively  while  waiting  for  some  other  em- 
ployment. There,  too,  the  family  is  taken  with  the  man, 
and  hundreds  of  people  have  found  a  temporary  home,  many 
of  them  for  the  first  time  learning  to  farm  and  graduat- 
ing into  excellent  workers  who  have  at  last  secured  good 
places,  or  who  have  since  taken  up  land  for  themselves. 
The  idea  of  the  state  farm  is  that  it  shall  be  a  "transit  sta- 
tion" through  which  a  steady  stream  of  labour,  changed 
from  non-effective  to  effective,  should  pass. 

It  was  at  first  attempted  to  have  the  elderly  men  with 
their  families,  who  have  been  the  principal  beneficiaries  of 
the  scheme,  learn  to  work  together  co-operatively,  but,  I 
was  told  by  one  who  knew,  "the  women  spoiled  all  that." 

The  experiment  of  the  state  farm  was  handicapped  by  the 
very  unsuitable  character  of  the  land  assigned  to  the  Labour 
Department  by  the  Land  Department — almost  as  if  the  lat- 
ter were  not  in  sympathy  with  the  project.  Eight  hundred 
acres  of  heavy  forest  and  scrub  is  not  precisely  the  kind 
of  paradise  one  would  choose  for  a  fresh  start  in  life  for 
elderly  and  unskilled  men,  many  of  them  townsmen. 

That  the  Labour  Department  has  been  able  to  achieve 
such  results  as  are  to  be  credited  to  the  state  farm  speaks 
volumes  for  the  faithfulness  and  intelligence  of  its  officials, 
and  says  no  less  for  the  wealth-producing  powers  of  even 
poor  labour  on  poor  land. 

The  unemployed — there  were  thirty-seven  at  the  start, 
with  fifty-seven  dependents — were  put  to  clearing  off  tim- 
ber, working  on  the  co-operative  plan  and  paid  full  wages. 
This  kept  them  in  good  heart,  but  manifestly  made  the 
clearing  much  more  expensive  than  that  done  by  the  private 
settler,  who  does  not  make  six  or  seven  shillings  a  day  out 
of  clearing  his  land.  The  sales  of  timber  made  an  impor- 
tant contribution  to  the  expenses  of  the  farm. 


THE   STATE   FARM  203 

As  they  felled  the  timber  the  men — constantly  changing, 
of  course,  with  new  arrivals  and  departures — went  on  mak- 
ing fences  and  roads,  and  building  cottages.  The  value 
of  the  improvements  created  in  this  way — by  fugitive  and 
inexperienced  labour — has  come  within  three  thousand 
pounds  of  the  total  cost  of  the  farm  to  the  government,  and 
as  land  that  was  worth  $20  an  acre  has  been  made  worth 
$60,  the  experiment  has  been  financially  successful,  to  say 
nothing  of  the  human  salvage. 

A  considerable  part  of  the  men  taken  in  at  Levin  have 
been  elderly  and  helpless  workmen,  for  whom  private  em- 
ployers and  public  works  offered  no  opportunity,  and  its 
function  has  been  specially  benign  on  that  account.  To 
make  these  men  self-supporting  is  a  more  skilful  and  more 
useful  task  than  any  other  a  fraternal  government  could  un- 
dertake. This  state  farm  holds  a  necessary  place  in  the 
political  economy  of  such  a  country  as  New  Zealand — or 
any  other  country. 

The  important  scheme  of  dealing  with  the  unemployed 
formulated  by  the  Unemployed  Advisory  Board  of  New 
South  Wales,  noticed  on  another  page,  recommends  such  a 
farm  as  an  indispensable  part  of  its  plan  to  educate  the  out- 
of-works  to  the  point  at  which  they  can  be  made  useful  in 
public  works  and  in  the  settlement  of  the  land.  Such  an 
adjunct  any  thorough  governmental  plan  for  dealing  with 
the  human  detritus  of  our  industrial  system  must  have. 

If  the  Labour  Department  and  the  Public  Works  De- 
partment and  the  private  employer  have  no  call  for  our 
out-of-work,  he  has  still  the  Land  Department.  Minister 
McKenzie,  though  a  farmer  and  the  representative  of  a 
farmers'  district,  has  not  limited  his  sympathies  nor  his 
efforts  to  satisfying  the  land  hunger  of  the  farmers'  sons 
and  daughters  who,  though  they  had  money,  could  not, 
under  the  old  squatter  regime,  get  land.  Under  him  the 


204  TRAMPS   MADE  TAXPAYERS 

village  settlements  of  Rolleston  and  Ballance  have  been  de- 
veloped into  the  "Improved  Farm  Settlements,"  which  are  a 
more  practical  and  successful  contribution  to  the  settlement 
of  the  unemployed  question  than  anything  to  be  seen  in 
Australia,  Europe  or  America. 

The  Improved  Farm  Settlements  are  communities  built 
on  a  foundation  of  land,  labour  and  co-operation,  to  give 
homes  and  a  place  in  the  world  to  the  man  who  has  lost 
them  all  in  the  fierce  struggle  of  modern  life,  and  whose 
destiny,  if  unassisted,  is  to  be  degraded  into  a  consumer  who 
produces  nothing.  The  Improved  Farm  Settlement  is  New 
Zealand's  attempt  in  the  field  where  most  other  nations  have 
nothing  to  show  but  poorhouses,  jails,  and  potters  fields 
for  the  "surplus"  population.  Out  of  the  idle  land  and  idle 
men  the  democracy  of  New  Zealand  are  now  at  work  cre- 
ating a  new  type  of  social  and  economic  organisation.  Con- 
sidering the  vital  character  of  the  problem  of  the  unem- 
ployed and  the  practically  complete  failure  of  every  attempt 
to  deal  with  it  elsewhere,  this  experiment  is  certainly  of 
fascinating  and  momentous  interest. 

There  are  forty-five  of  these  Improved  Farm  Settlements 
in  the  Wellington,  Taranaki,  Auckland,  Hawkes  Bay, 
Otago,  and  Southland  districts.  Most  of  them  are  in  the 
North  Island,  where  the  unreclaimed  public  lands  are. 
They  cover  an  area  of  73,320  acres.  There  were  on  them 
at  the  last  report  513  land  holders  and  1854  residents. 
There  have  been  917  men  enlisted  in  this  work,  and  364 
have  left.  The  settlers  had  cleared  15,141  acres  of  the 
bush  and  had  grassed  20,814.  They  had  been  advanced 
$286,645,  while  the  total  value  of  the  improvements  which 
had  been  made  by  them  was  $420,840,  and  they  have  paid 
in  rent  and  interest  $13,210. 

This  result  has  been  achieved  by  the  combination  of  the 
waste  forests  and  waste  labourers  of  the  community.  Using 


ROADS  TO  INDEPENDENCE  205 

the  unemployed  to  make  roads  is  not  a  new  idea,  but  New 
Zealand  is  the  only  country  that  has  had  the  wit  to  see  that 
the  tramps  could  build  roads  on  which  the  tramp  himself 
could  travel  to  independence.  While  New  Zealand  was 
doing  this  with  its  unemployed  one  of  its  neighbouring 
colonies  was  setting  them  to  scrape  paint  off  park  fences. 

When  an  Improved  Farm  Settlement  is  to  be  opened  a 
tract  of  Crown  land  is  selected  which,  when  cleared,  will  be 
suitable  for  farming,  especially  for  dairying.  It  is  sur- 
veyed, roads  are  laid  out,  and  it  is  cut  up  into  farms  vary- 
ing from  ten  to  two  hundred  acres,  according  to  the  quality 
and  use.  Crown  lands  only  are  used  for  this,  not  lands 
which  the  state  has  had  to  buy  back.  These  latter  are  al- 
ready improved,  and  the  public  could  not  afford  to  let  them 
go  to  settlers  who  would  not  know  how  to  make  them  imme- 
diately productive,  whereas  on  forest  land  their  unskilled 
labour  immediately  begins  to  create  value. 

Maori  tribal  lands  cannot  be  taken  for  settlement,  but 
must  be  bought.  However,  the  Maoris  are  constantly  ap- 
plying to  have  their  titles  registered  under  the  Crown.  They 
thereby  get  individual  ownership,  and  the  government  can 
then  take  the  lands  as  it  is  constantly  doing.  It  buys  the 
interest  of  eight  or  ten  of  a  tribe  and  then  applies  to  have 
this  cut  out  by  the  land  courts,  after  which  it  can  use  it 
as  it  chooses.  The  Maoris  are  allowed  to  become  settlers 
in  the  Improved  Farm  Settlements,  as  even  a  newly  landed 
immigrant  could  do.  "We  do  not  exclude  aliens,"  the  offi- 
cials told  me. 

The  party  of  unemployed  which,  has  been  forwarded  by 
the  Labour  Department  is  received  at  the  scene  of  the  pro- 
posed settlement  by  an  officer  of  the  Land  Department. 
They  find  there  everything  needed  for  shelter  and  work, 
and  they  find  the  public  land  in  the  vicinity  surveyed  into 
sections  and  waiting  for  occupancy  by  them.  The  sec- 


206  TRAMPS  MADE  TAXPAYERS 

tions  are  distributed  among  the  applicants  by  lot.  Mar- 
ried men  have  the  preference  in  the  distribution  both  of 
work  and  land.  All  are  immediately  set  to  work  to  clear 
away  "the  bush"  and  grass  their  land,  so  that  it  may  be  fit 
for  cropping  or  pasture.  At  the  same  time  they  are  given 
work  on  the  roads  which  are  to  connect  their  new  homes 
with  civilisation,  or  on  some  railroad  or  other  public  work 
in  the  vicinity,  and  it  is  arranged  that  they  shall  divide  their 
time  between  their  own  and  the  public  work.  As  they 
clear  their  lands  and  get  them  into  grass,  money  is  lent 
them  on  the  value  they  thus  create,  and  fifty  dollars  at  least 
will  be  advanced  to  each  married  man  to  help  him  build 
his  home. 

"Men  absolutely  destitute,"  the  Minister  of  Lands  said 
to  me,  "in  that  way  become  thrifty  settlers." 

"By  this  plan,"  said  Premier  Seddon,  "we  at  the  same 
time  build  our  highways,  and  deposit  in  permanent  settle- 
ment by  their  side  the  labour  that  builds  them." 

When  I  was  in  New  Zealand  the  Land  Department  was 
employing  about  two  thousand  men  in  making  roads  upon 
the  Crown  lands. 

Many  of  the  men,  of  course,  abandon  their  holdings,  and 
these  are  then  usually  offered  to  those  of  their  neighbours 
who  stay.  The  policy  of  the  department  is  to  allow  the 
successful  men  to  absorb  the  land  of  the  unsuccessful  ones 
up  to  a  reasonable  limit. 

While  the  settlers  are  struggling  they  are  not  asked  to 
pay  rent,  but  when  an  outlet  for  their  products  is  secured 
and  they  are  making  a  living,  the  representative  of  the 
Land  Department  in  the  neighbourhood  notifies  his  superior 
"that  the  time  has  now  come  when  the  settlers  should  be 
required  to  pay  rent." 

Temporary  work  is  also  furnished  for  the  unemployed 
in  felling  the  forests  on  the  public  lands;  but  the  practical 


TALK   WITH   THE   PREMIER  207 

genius  of  the  New  Zealander  does  not  believe  in  temporary 
remedies,  and  his  main  energies  have  been  given  to  the 
method  by  which  the  unemployed  are  given  work  not  dur- 
ing the  slack  season,  but  for  the  rest  of  their  lives,  if  they 
choose  to  take  advantage  of  it. 

Most  of  the  men  who  find  refuge  in  the  Improved  Farm 
Settlements  are  of  the  class  of  ordinary  labourers — "nav- 
vies"— but  there  is  among  them  a  sprinkling  of  skilled  la- 
bourers and  the  artisan  class.  Among  the  other  things 
done  for  them  is  to  teach  them  how  to  work.  The  in- 
struction given  them  is  not  simply  how  to  work  their 
land,  as  was  shown  by  a  conversation  I  heard  between  one 
of  the  settlers  and  the  agent  of  the  Land  Department. 
This  settler  had  been  a  carpenter,  and,  being  rather  slow, 
had  found  himself  always  at  a  disadvantage  in  the  labour 
market,  and  had  consequently  betaken  himself  to  work  on 
the  roads  and  settlement  on  government  land.  He  had 
eight  children  and  one  hundred  acres  of  land  to  look  after 
and  was  doing  well  with  both.  When  I  came  to  his  place 
he  was  building  a  bridge,  at  his  own  expense,  over  the  creek 
in  front  of  his  house.  He  told  the  official  that  he  and  the 
other  settlers  in  the  neighbourhood  would  get  on  much 
better  if  they  could  have  a  creamery.  He  had  written  to 
the  Agricultural  Department  about  it,  but  had  received  an 
unfavourable  answer. 

"Do  not  rest  satisfied  with  this  answer,"  the  official  said. 
"There  are  different  ways  of  doing  these  things.  If  you 
cannot  do  anything  by  correspondence,  apply  direct  to  the 
Premier.  Two  or  three  of  you  go  and  talk  with  him  at 
Inglewood,  where  he  is  to  make  a  speech  in  a  fortnight. 
You  can  do  more  in  twenty  minutes'  talk  than  by  reams 
of  correspondence." 

A  creamery  would  cost  about  $8000.  The  Department 
of  Agriculture,  under  the  law,  is  authorised  to  advance 


208  TRAMPS    MADE   TAXPAYERS 

funds  for  the  erection  of  creameries  if  the  settlers  can  pro-- 
vide their  proportion,  which,  in  this  case,  would  have  been 
about  $2500,  but  the  people  here  could  raise  only  $1250. 
There  was  a  discretionary  power,  however,  to  make  a  larger 
advance,  and  hence  the  recommendation  to  apply  to  the 
Premier. 

This  scene  between  the  official  and  the  settler  reminded 
me  of  a  remark  by  the  Minister  of  Lands  telling  why  one 
of  his  men  had  been  chosen  to  administer  the  land  laws  in 
his  district. 

"Because,"  the  Minister  said,  "he  has  a  human  heart  and 
will  look  out  for  the  settlers,  and  also  has  a  good  head  and 
can  protect  the  interests  of  the  government." 

The  largest  of  these  Improved  Farm  Settlements  is 
Whangamomona,  in  the  Taranaki  district.  The  settlements 
are  usually  of  ten  to  fifteen  sections,  or  even  less,  but  here 
about  one  hundred  and  eight  were  offered.  Ninety-eight 
were  taken  immediately.  About  fifty  of  the  settlers  remain, 
but  some  of  these  are  likely  to  be  dropped.  Seven  years 
ago  this  region  was  an  unbroken  wilderness.  The  survey- 
ing party  had  to  work  its  own  way  through,  and  had  to 
carry  its  tents,  food,  "billies,"  as  the  Australasians  call  the 
pail  they  make  tea  in,  and  all.  Now  the  traveller  goes 
twenty-five  miles  by  coach,  twenty  miles  more  on  good 
roads,  and  half  a  dozen  miles  farther  on  a  bridle  path,  which 
is  the  forerunner  of  the  coach  road  to  follow.  He  finds 
flourishing  farms  all  the  way.  If  one  was  asked  to  give 
the  age  of  the  settlement  from  appearances,  he  would  think 
it  to  be  at  least  twenty-five  years  old,  instead  of  seven. 

"It  is  usually  the  small  settlements  that  succeed.  A  few 
men  well  placed,  with  land  enough  near  by  a  population 
which  can  give  the  men  work,  or  near  public  works — this  is 
the  secret  of  success  for  this  kind  of  experiment."  The 
erection  of  a  creamery  in  the  neighbourhood  almost  always 


EVERYTHING   BUT   TUCKER  209 

makes  success  certain,  and  it  is  for  this  reason  that  money 
is  advanced  for  them. 

The  department  gives  the  men  whom  it  thus  brings  out 
to  put  on  the  land  nothing,  but  it  advances  them  everything 
except  "tucker" — food.  They  and  their  families,  if  these 
are  with  them,  even  find  ready  for  them  on  the  ground  of 
their  new  start,  tents  for  shelter.  These  were  at  first  lent, 
but  this  it  was  found  made  the  men  careless.  Now  they 
must  pay  a  rent  which  is  deducted  from  their  wages.  All 
the  tools  that  they  need — slasher,  spade,  shovel,  pick- 
are  furnished  them,  and  for  these,  too,  they  must  pay  in 
the  same  way.  These  are  all  bought  by  wholesale,  and 
sold  to  them  at  only  enough  of  an  advance  to  cover  the 
cost.  Hand  carts  and  barrows  they  are  allowed  to  use  free ; 
timber  jacks  they  must  pay  a  shilling  a  day  for;  these  cost 
the  government  $37  each. 

"Tucker"  the  men  can  get  on  credit  if  they  have  a  job. 
The  storekeepers  are  on  hand  at  the  monthly  payments,  and 
they  can  always  ascertain  from  the  official  inspector  how 
much  each  man  is  getting.  Payments  are  made  at  the 
works,  and  are  in  cash.  The  Land  Department  at  one  time 
proposed  to  start  a  store  of  its  own  in  the  vicinity  of  Whan- 
gamomona.  It  found  that  the  storekeepers  were  charging 
extortionate  prices  for  provisions,  in  consequence  of  which 
the  men  demanded  higher  pay.  Instructions  were  given  to 
the  local  officers  that  unless  prices  were  reduced  they  should 
open  stores.  This  was  abandoned  because  it  was  seen  that 
if  this  was  done  it  would  never  be  possible,  on  humanitarian 
grounds,  to  refuse  food  to  the  wives  and  children  of  the 
men  in  the  settlement,  even  if  they  would  not  work.  Such 
a  scheme,  moreover,  would  have  been  a  violation  by  the 
government  itself  of  its  own  truck  act,  forbidding  payment 
in  kind. 

One  of  the  most  important  things  which  is  taught  the 


210  TRAMPS   MADE   TAXPAYERS 

men  is  to  work  co-operatively,  as  has  been  described  in 
the  chapter,  "The  Workmen  are  the  Contractors."  Instead 
of  a  contractor  there  is  the  public  engineer,  who  lays  out 
the  work  and  makes  contracts  with  each  group  of  men  to 
do  such  work  as  they  bid  for.  "With  the  exception  of  a 
few  special  items,"  the  land  report  for  1899  says,  "all  the 
work  done  by  the  department  has  been  on  the  co-operative 
system." 

When  a  "co-operative  gang"  has  been  formed  by  the 
men — it  must  consist  of  four,  but  there  may  be  as  many 
more  as  the  men  wish — they  then  choose  their  head  man. 
He  represents  them  in  the  contract  made  with  the  depart- 
ment. The  money  due  each  month,  called  "progress 
money,"  is  paid  to  him,  but  in  the  presence  of  the  others. 
The  statement  issued  to  the  head  man  gives  all  the  items, 
deductions  and  the  like,  and  any  member  of  the  gang  can 
see  it.  The  men  can  change  their  head  man  at  any  time 
they  desire  to  do  so.  It  is  very  seldom,  I  learned,  that  any 
four  men  come  together  again  after  having  once  worked 
with  each  other. 

When  the  men  first  come  from  the  cities  to  this  rural 
life  they  show  their  inexperience  and  irresponsibility  in 
curious  ways.  It  was  found  from  the  storekeepers  in  one 
of  the  settlements  I  visited  that  the  settlers  when  they  first 
came  spent  from  five  dollars  and  upward  a  week  for 
"tucker,"  buying  all  kinds  of  fancy  goods,  like  sardines, 
where  the  ordinary  workman  spends  only  half  that  amount. 
This  exuberance  soon  wears  off.  Getting  their  gardens 
makes  a  great  difference.  "Our  potatoes,  carrots,  parsnips, 
and  other  truck  make  a  difference  of  one  half  in  our  flour 
bill,"  one  of  the  settlers  told  me. 

The  Whangamomona  settlement,  through  which  I  rode 
for  two  days,  is  a  very  picturesque  illustration  of  the  land 
settlements  of  this  type.  Two  thousand  acres  are  reserved 


BABIES  AND  ROSES  211 

here  to  preserve  the  beauty  of  the  road.  This  has  been 
built  entirely  by  the  labour  of  the  men  who  have  been 
brought  from  Wellington,  Christchurch,  Napier  and  other 
towns,  and  is  a  fine  specimen  of  mountain  engineering, 
and  a  link  in  the  main  highway  on  the  west  side  of  the 
North  Island.  The  settlement  is  three  years  old.  The 
gardens,  the  galvanised  iron — "tin" — houses,  the  wooden 
chimneys  built  outside,  the  cows  feeding  in  pastures  black- 
ened with  the  stumps  of  the  timber  felled  and  burned,  the 
doorways  filled  with  groups  of  children  growing  within  as 
luxuriantly  as  the  flowers  and  vines  without,  make  a  land- 
scape which  may  have  too  many  sharp  edges  and  colours 
too  incongruous  to  delight  the  eye  of  the  landscape  painter, 
but  it  is  a  picture  any  statesman  might  be  proud  to  sign 
his  name  to. 

Every  home  here  is  an  adventure — the  goal  of  a  Pilgrim's 
Progress,  very  prosaic  no  doubt,  but  thrilling  enough  to 
the  men  and  women  and  children  who  have  been  enabled  to 
shut  these  doors  against  the  city  wolves  of  want.  One  of 
the  cottages  here  is  the  castle  of  a  man  who  had  been  a  day 
labourer  in  Christchurch.  He  began  by  working  on  the 
road,  then  opened  a  boarding-house.  He  had  one  hundred 
acres.  Among  other  products  is  a  house  full  of  children. 

Not  far  away  lives  another  "successful  man,"  who  was 
a  day  labourer  out  of  work.  Given  this  chance,  he  saved 
money,  bought  cows  and  made  butter  to  sell  to  the  other 
workingmen. 

Yonder  is  the  house  of  an  Irish  baronet.  He  has  come 
in  here,  taken  up  land,  and  gone  to  work  like  any  day 
labourer,  and  is  doing  better  than  the  average. 

Occasionally  some  abandoned  house  tells  of  a  man  who 
has  given  up  the  struggle. 

Here  is  a  gas  stoker  from  Napier,  who,  when  he  lost 
his  job,  went  to  the  Land  Department  for  a  life  position 


212  TRAMPS    MADE   TAXPAYERS 

as  one  of  its  tenants.  He  has  sixty  acres,  and  his  house 
is  a  bower  of  roses  and  babies.  In  the  garden  is  a  new 
Russian  forage  plant  that  grows  as  a  tree,  with  which  he  is 
experimenting.  The  mother  points  with  joy  to  the  little 
four-year-old,  who,  when  eighteen  months  old  in  town, 
could  not  walk,  but  is  now  running  everywhere. 

"We  cannot  expect  to  get  much  out  of  it  for  ourselves," 
she  says,  "but  we  will  make  the  children,  we  hope,  inde- 
pendent." 

Not  far  away  is  the  place  of  one  who  was  an  ordinary 
wood  cutter,  who  is  now  living  on  twenty  acres  of  his  own, 
in  a  house  which  the  Land  Department  helped  him  to  build 
by  advancing  him  $75.  The  men  take  great  pride  in  their 
new  homes,  and  many  of  them  travel  every  day  miles  on 
horseback  to  get  work  to  keep  them  going,  if  no  work  is 
to  be  had  near  by. 

In  a  house  which  I  asked  permission  to  photograph  there 
was  a  window  not  glazed.  "Take  it  so  as  not  to  show  the 
window  with  the  canvas  cover,"  the  owner  pleaded.  This 
man  was  discussing  with  the  government  officer,  Mr.  G.  F. 
Robinson,  with  a  record  of  nearly  thirty  years'  service,  the 
disposition  of  the  section  adjoining  his. 

"I  hope  Lockwood  will  get  it,"  he  said.  "He  has  a  lot 
of  children.  We  have  nine  children  of  school  age  in  the 
settlement  now,  but  no  school.  This  little  settlement  was  at 
the  extreme  end  of  the  bridle  path  into  which  the  coach  road 
and  the  waggon  road  had  dwindled,  as  we  penetrated  far- 
ther and  farther  into  the  wilderness.  As  soon  as  possible 
a  school  will  be  established  here,  for  the  democracy  follows 
the  settlers  close  with  the  schoolhouse,  although  the  pay  of 
the  schoolmaster  is  not  very  large — in  one  settlement 
$7.50  a  week.  In  New  Zealand  primary  education  is  free, 
universal,  secular  and  compulsory,  and  thirteen  four- 
teenths of  the  children  are  educated  by  the  state.  In  the 


TEN  CHILDREN  ON  FOUR  HORSES       213 

Whangamomona  settlement  I  saw  ten  children  going  to 
school  on  four  horses,  and  sometimes  there  are  four  to  be 
seen  on  one  horse.  We  saw  three  little  ones  who  had  to 
walk  six  miles  every  day. 

Each  family  has  its  separate  home.  The  co-operation  is 
in  the  work,  not  the  living.  The  preference  always  shown 
for  married  settlers  in  giving  out  road  and  other  work  is 
really  a  preference  for  children.  One  of  the  reasons  urged 
for  the  resumption  of  the  large  estates  when  that  measure 
was  in  Parliament  was  that  it  would  help  young  people  to 
marry.  The  political  economy  of  New  Zealand  takes  large 
account  of  the  baby  crop.  Single  men  are  forced  out  of  the 
settlements  rigorously  if  they  do  not  comply  to  the  letter 
with  all  the  regulations.  For  instance,  settlers  must  make 
improvements  in  proportion  to  the  money  paid  them  for 
public  works.  Single  men  are  required  to  improve  to  the 
extent  of  one  half  of  the  wages  they  receive,  but  married 
men  to  the  extent  of  only  one  third.  The  enforcement  of 
this  rule  is  strict  and  drives  out  the  undesirable  single  men. 

This  settlement,  like  most  of  the  Improved  Farm  Settle- 
ments, shows  a  decrease  in  the  number  of  persons  living  on 
it,  but  an  increase  in  the  work  done  and  the  value  of  the 
improvements.  In  other  words,  the  natural  and  official 
weeding-out  process  is  making  itself  felt.  The  men  who 
are  unfit  or  unwilling  are  leaving,  but  those  who  remain 
are  working  so  faithfully  that  the  wealth  of  the  little  com- 
munity is  increasing  faster  than  the  number  of  inhabitants 
declines. 

In  1898  there  were  187  persons  on  the  land  in  Whanga- 
momona; in  1899,  1 68,  but  the  number  of  cattle,  horses  and 
sheep  has  increased  from  887  to  1178  and  the  value  of 
the  houses,  gardens,  etc.,  has  grown  from  $11,095  to  $2°r 
245.  The  number  of  acres  under  grass  is  3052  against 
2202  the  year  before.  The  official  report  says: 


214  TRAMPS    MADE   TAXPAYERS 

"The  settlement  may  now  be  said  to  be  permanently  estab- 
lished. A  large  school  has  been  erected  and  opened.  A 
dairy  factory" — the  one  as  to  which  we  overheard  the  Land 
Department  officer  giving  advice  to  one  of  the  settlers — "is 
in  contemplation,  and  most  of  those  settlers  who  now  hold 
land  will,  in  all  probability,  remain  and  become  good 
settlers." 

There  are  six  Improved  Farm  Settlements  near  Auck- 
land, three  to  the  north  and  three  to  the  south,  sheltering 
about  sixty  families.  In  this  district  work  and  land  have 
been  given  only  to  married  men.  So  far  at  least  eighty 
per  cent,  of  the  men  have  proved  permanent.  The  settle- 
ments were  fortunate  in  their  proximity  to  saw-mills,  kauri 
forests  and  other  sources  of  employment.  The  advance 
of  money  to  men  here  to  build  with  has  been  discontinued 
because  it  was  found  that  some  borrowed  and  built  only 
to  get  work,  and  then  cleared  out. 

When  there  was  no  road  work  to  be  had  the  Land  De- 
partment helped  these  men  out  by  allowing  them  to  fell 
kauri  trees  on  their  own  sections  and  on  Crown  lands  by 
payment  of  a  royalty.  The  timber  was  felled  by  co-opera- 
tive gangs  working  together,  and  only  resident  settlers 
were  employed  at  this  work,  so  that  the  money  earned  might 
be  kept  amongst  them.  For  the  settlers  physically  inca- 
pable of  the  severe  labour  required  in  felling  kauri  road 
work  was  provided,  if  possible. 

At  Mangatu,  Auckland  North,  the  ten  original  settlers 
are  still  resident,  and  with  their  families  number  seventy- 
three  souls.  They  have  been  advanced  $7165,  and  this  has 
enabled  them  to  make  the  improvements  worth  $13,115. 

At  Uruti,  in  the  Taranaki  district,  out  of  seven  settlers 
four  remain.  There  are  twenty-two  persons  on  the  land, 
and  with  them  are  one  hundred  and  forty-three  cattle,  twen- 
ty-six sheep  and  four  horses.  These  four  men  obtain  work 


ADVANCES   OF   MONEY  215 

enough  from  the  local  authorities  and  farmers  with  large 
holdings  near  by  to  be  able  to  dispense  with  any  necessity 
for  further  assistance.  They  have  cleared  and  grassed  five 
hundred  and  two  acres.  They  have  a  post-office,  a  school 
is  soon  to  be  erected,  and  a  dairy  factory  will  be  established. 

Nihoniho,  in  the  same  district,  is  an  instance  of  a  set- 
tlement pushed  too  far  ahead  of  the  opportunities  for  em- 
ployment by  its  members.  The  soil  is  very  good,  but  the 
lands  around  it  are  not  yet  open.  As  soon  as  the  road  work 
in  their  immediate  vicinity  was  completed  the  selectors,  with 
the  exception  of  three,  abandoned  the  district. 

Akitio,  in  the  Wellington  district,  contains  3300  acres, 
held  by  32  settlers,  with  66  persons  to  be  supported  by  them. 
Twenty-three  of  the  settlers  are  employed  on  the  roads  near 
by,  two  work  at  saw-mills,  three  find  work  to  do  on  their 
own  holdings.  By  energy,  industry  and  economy  many 
who  started  without  means,  depending  on  road-making  and 
Treasury  assistance  in  clearing  and  other  improvements,  are 
now  comfortably  housed,  have  part  of  their  sections  cleared, 
grassed  and  stocked,  and  in  a  few  years'  time,  when  the 
road  work  is  completed,  will  have  their  holdings  in  such 
a  forward  state  as  will  enable  them  to  get  a  comfortable 
living  without  having  to  depend  on  outside  work. 

The  three  settlements  of  Ngaire,  Poti  and  Maata,  in  the 
Taranaki  district,  are  well  established,  the  settlers  have  paid 
up  most  of  their  rent  and  are  now  practically  beyond  the 
need  of  assistance. 

At  Mangaere,  which  we  passed  through  on  our  way  to 
Whangamomona,  an  ordinary  bushman  was  living  on 
twenty  acres',  in  a  house  on  which  the  government  had  ad- 
vanced him  seventy-five  dollars  as  soon  as  it  was  finished. 
All  the  men  in  this  settlement  have  been  advanced  money 
on  their  houses  and  work  in  sums  ranging  from  $50  to  $100. 

Ten  persons  here  have  made  improvements  of  $5200. 


216  TRAMPS    MADE   TAXPAYERS 

The  only  rent  in  arrears  is  $4  due  from  one  man.  The 
future  of  this  settlement  is  assured  by  a  creamery  which 
was  erected  in  1899. 

One  of  the  twelve  settlers  at  Kawatau  died  during  the 
year  1899,  leaving  his  widow  in  possession  of  his  section. 
The  only  public  expenditure  during  the  year  was  incurred 
for  grass  seed  and  sowing  eight  acres  of  land  for  this  widow. 

There  are  kickers  and  grumblers  of  course.  One  very 
intense  specimen  of  this  type  whom  I  met  indulged  himself 
out  of  pique  with  his  own  government  in  an  enthusiastic 
advocacy  of  the  superior  virtues  of  everything  in  America. 
He  read  me,  with  much  gusto,  in  the  presence  of  an  official 
of  the  Land  Department,  an  article  which  he  had  published 
in  the  local  paper. 

"In  this  district,"  his  article  ran,  "the  farmer  makes 
the  road  to  his  farm  with  an  American  pick  and  shovel,  he 
puts  in  his  wheat  with  an  American  drill,  he  reaps  it  with 
an  American  reaper  and  binder,  he  pumps  the  water  for  his 
harvest  hands  through  an  American  pump,  he  takes  his 
wheat  to  a  mill  where  the  most  intricate  machinery  is  Amer- 
ican, he  drives  around  town  in  a  buggy  that  is  mostly 
American,  his  timber  is  cut  with  an  American  axe,  the  ham- 
mer that  drove  the  nails  in  his  house  was  an  American  ham- 
mer, his  saw  was  American,  and,  finally,  his  wheat  rolls 
into  Wellington  behind  an  American  locomotive." 

This  man's  denunciation  of  the  land  policy  was  most  vin- 
dictive, but  it  had  its  origin  in  the  enforcement  of  a  neces- 
sary regulation.  He  wanted  to  graze  other  men's  cattle  on 
his  land.  The  land  board  told  him  that  he  could  do  so, 
but  that  he  must  pay  the  receipts  over  to  it.  In  the  same 
way,  if  he  sold  timber  from  the  section  he  would  have  to 
turn  the  money  into  the  treasury  of  the  land  board,  for  the 
obvious  reason  that  the  treasury  was  lending  him  money 
on  the  security  of  this  timber  and  grass. 


THE   MOST   NEEDY   CLASS  217 

This  grumbler  had  been  one  of  those  with  no  money,  no 
land,  no  work.  His  fellow-citizens  gave  him  a  chance  to 
get  all  these  and  he  had  got  them,  but  apparently  he  recip- 
rocated none  of  the  kind  interest  in  the  welfare  of  the  others 
which  lay  at  the  bottom  of  the  scheme  of  settlement,  which 
was  making  a  man  of  him.  Had  he  been  a  member  of  a 
co-operative  society  which  did  these  things  for  him — that  is, 
if  he  had  done  them  for  himself  in  a  nearer  and  more  realis- 
able way  than  doing  it  for  himself  through  the  state,  he 
might  perhaps  have  appreciated  it. 

There  is  a  more  needy  class  even  than  the  navvies  and 
out-of-works  who  get  the  most  of  the  benefit  of  the  Im- 
proved Farm  Settlements.  This  more  necessitous  class  is 
the  unemployed  tradesmen,  mechanics,  clerks,  and  the  like. 
For  them  some  form  of  co-operative  settlement  is  being 
urged,  and,  in  connection  with  that,  some  organised  system 
of  instruction  such  as  is  proposed  by  the  Unemployed  Ad- 
visory Board  of  New  South  Wales,  as  noted  on  a  following 
page.  What  this  class  can  do,  however,  even  under  the 
present  system,  is  shown  by  the  experience  of  two  printers 
of  which  I  learned  in  Auckland.  When  the  linotype  was 
rising  on  the  horizon  of  the  compositors,  the  member  of  the 
upper  house  of  Parliament  for  that  district,  the  Honourable 
W.  T.  Jennings,  at  a  meeting  of  the  Typographical  Union, 
pointed  out  how  great  a  mistake  it  would  be  for  the  men 
who  were  certain  to  be  thrown  out  to  hang  about  the  cities. 
They  had  on  the  average  about  $500  of  savings.  The 
trade-union  would  allow  each  man  displaced  about  $75 
more.  The  "Herald"  of  Auckland  agreed  to  add  some- 
thing to  this.  Their  savings  and  this  assistance,  if  they 
stayed  in  town,  it  was  pointed  out  to  them,  would  melt 
away,  and  at  the  end  of  the  year  they  would  be  penniless 
and  with  no  prospect  of  any  future  help.  Their  represen- 
tative in  Parliament  advised  them  to  go  into  one  of  the 


218 

village  settlements.  He  promised  that  he  would  use  his 
influence  to  have  good  land  assigned  them  by  the  Land  De- 
partment. He  offered  to  go  himself  into  this  new  settle- 
ment life  with  them.  But  he  could  not  raise  the  least  in- 
terest in  his  suggestion.  One  or  two  said  it  would  be  a 
good  thing,  but  made  no  move. 

The  event  has  been  just  as  he  anticipated.  The  men 
who  have  been  displaced  by  the  typesetting  machine  are 
drifting  up  one  street  and  down  another.  There  is  no  pos- 
sibility of  their  getting  work  at  their  own  trade,  and  they 
have  exhausted  all  the  help  they  received. 

Meanwhile  two  of  the  brightest  young  men  among  them, 
who  saw  what  was  coming,  went  into  the  country,  and  have 
had  a  very  different  experience.  Getting  some  public  land, 
they  put  what  money  they  had  into  stock,  tools  and  their 
maintenance.  They  had  a  very  rough  time,  but  at  last  are 
getting  their  feet  firmly  planted  on  the  ground,  and  the 
ground  is  their  own.  While  the  other  men  go  on  rotting, 
these  men  will  be  growing  more  independent,  and  will  be 
raising  children  and  strengthening  the  state  along  with 
themselves. 

This  success  is  something  like  that  which  has  been 
achieved  by  purely  voluntary  effort  on  "Printers'  Farm," 
which  has  been  established  by  the  "Big  Six"  Typographical 
Union  of  New  York.  This  union,  foreseeing  what  was 
coming  in  the  introduction  of  the  typesetting  machine, 
bought  one  hundred  and  sixty  acres  a  mile  south  of  Bound 
Brook,  New  Jersey,  and  there,  on  some  of  the  richest  soil 
in  New  Jersey,  under  the  Watchung  Mountains,  in  a  scene 
rich  with  revolutionary  associations,  is  a  colony  of  forty- 
seven  men — printers  who  have  made  themselves  farmers. 

These  Improved  Farm  Settlements  are,  as  we  have  shown, 
not  all  successful.  Some  mistakes  have  been  made,  but 
the  fact  that  the  population  is  holding  its  own  and  that 


MORE   THAN    IMPERIAL 


219 


improvements  are  increasing  shows  that  the  system  is  tak- 
ing root.1  The  numbers  may  seem  small  to  those  whose 
imaginations  have  become  imperial.  Two  thousand  and 
ninety-three  men  settled  on  the  land,  they  and  their  depen- 
dents, numbering  6509,  may  not  seem  very  much,  but  the 
significance  of  the  plan  does  not  lie  in  the  numbers  already 
relieved,  though  these  speak  eloquently,  but  in  the  fact  that 
a  working  plan  has  at  length  been  devised  and  put  into  suc- 
cessful operation  which  can  be  expanded  to  meet  any  of 
the  demands  of  the  problem.  No  other  country  has  done 

1  Adding  to  the  results  of  the  Improved  Farm  Settlements  those  of  the  Village 
Settlement  system,  also  mainly  for  the  benefit  of  the  unemployed,  we  have  the 
following  particulars  of  what  has  been  accomplished  by  New  Zealand  in  its 
attempt  to  convert  idle  land  and  idle  men  into  sources  of  social  and  financial 
strength  for  the  country. 

COMPARATIVE    STATEMENT    SHOWING    POSITION    IN    1899 

OF    IMPROVED    FARM    SETTLEMENTS    AND    VILLAGE 

HOMESTEAD    SETTLEMENTS. 


Particulars. 


Improved  Farm    Village  Homestead 
Settlements.  Settlements. 


Totals. 


Number  of  Settlements, 

45 

165 

310 

Area, 

73,655  acres 

35.454  acres 

109,109 

New   Selectors  during  1899, 

78 

101 

179 

Forfeitures  and  Surrenders, 

164 

62 

226 

Total  number  of  Selectors, 

526 

i,567 

2,093 

Total  number  of  persons  > 
on  the  land,             $ 

1,615 

4,894 

6,509 

Total  amount  advanced,  s  j>    u 

houses  £4,5  1  1 

Houses  £13,769 
Bush  felling  £t2,i65 

£18,280 
£53,906 

Rent  and  Interest  paid  > 
during  year,           J 

£7" 

£4,877 

£5,588 

Rent  and  Interest  paid  from  ) 
commencement  of  system,    } 

£1,064 

£3L873 

£32,937 

Improvements, 

£64,988 

£"5,834 

£180,822 

The  Treasury  has  advanced  $360,930,  $169,685  have  been  received  in  rent 
and  interest,  and  the  improvements  amount  to  more  than  twice  as  much  as  the 
loans,  $904,110 — a  pretty  good  investment  financially,  to  say  nothing  of  the  far 
more  important  interests  involved. 


220 


this  with  the  unemployed.  There  are  many  plans  for  the 
relief  of  this  unfortunate  class.  Here  is  what  is  wanted 
however — a  plan  not  to  relieve  but  to  rehabilitate,  to  restore 
them  to  their  economic  and  other  citizenship. 

Co-operative  labour  colonies  for  the  unemployed  have 
never  been  favoured  in  New  Zealand.  Though  the  New 
Zealanders  speak  of  themselves  as  "experimenters,"  I  ob- 
served that  they  keep  well  within  the  practical  in  their  ven- 
tures. This  is  probably  the  reason  for  the  success  they  have 
had.  Plans  for. such  settlements  are  urged  in  New  Zea- 
land, as  everywhere,  by  those  who  seek  a  short  road  to 
the  co-operative  commonwealth.  In  several  of  the  Aus- 
tralian colonies  some  very  ambitious  attempts  have  been 
made  to  realise  the  hopes  entertained  that  the  unemployed 
could  thus  be  organised  in  a  new  fashion  into  prosperous 
economic  and  civil  life.  But  the  New  Zealand  Minister  of 
Lands  believes  these  colonies  to  be  impracticable  at  present, 
and  "I  believe  in  the  practical,"  he  says. 

Michael  Davitt,  in  his  charming  and  valuable  book,  "Life 
and  Progress  in  Australasia,"  describes  graphically  the  co- 
operative communities  and  socialistic  settlements  which  were 
established  by  the  South  Australian  government  after  the 
panic  of  1893.  A  great  deal  of  time  and  energy,  public  and 
private,  have  been  spent  on  these  settlements.  When  Davitt 
was  there  the  prospects  were  of  the  brightest,  and  it  was 
with  keen  interest  that  I  inquired  about  them  when  I  ar- 
rived in  South  Australia.  Social  alarm,  "the  terror,"  had  a 
place  among  the  reasons  which  led  to  their  establishment. 
The  reaction  of  1893  was  extremely  severe  throughout  Aus- 
tralia. There  had  been  several  bad  years  of  drouth  to  add 
their  losses  to  those  of  the  panic.  A  building  boom  had 
collapsed,  and  the  unemployed  were  parading  the  streets  of 
Adelaide  with  black  flags,  holding  revolutionary  meetings, 
sleeping  by  thousands  in  the  parks,  and  demanding  bread 


A  COMMUNISTIC  WAVE  221 

and  work.  All  the  materials  for  a  great  riot  were  ready. 
It  was  under  this  pressure  that  the  people  and  the  officials 
acted,  the  latter  none  too  willingly. 

When  Norway  sent  to  see  if  land  could  be  had  in  South 
Australia  for  settlement  for  Norwegians  out  of  work  the 
government  had  replied  there  was  none.  It  said  now  to  the 
citizens  who  proposed  the  co-operative  experiments  that 
there  was  no  land  available.  But,  it  added,  if  you  can  find 
land  we  will  let  you  have  it.  Thereupon  three  men,  repre- 
senting the  workingmen — one  of  them  a  clerk,  another  a 
blacksmith,  and  the  third  a  roustabout — went  on  an  explor- 
ing expedition  to  see  if  land  could  be  found.  The  River 
Murray  which  flows  through  an  alluvial  valley,  had  hitherto 
been  used  only  for  sheep.  The  "squatters"  living  there 
declared  that  it  was  good  for  sheep  only,  but  the  working- 
men  believed  that  they  could  make  something  of  it  agricul- 
turally, although  they  recognised  the  difficulties  that  were 
involved  in  the  fact  that  cultivation  was  possible  only  with 
the  help  of  irrigation,  which  was  laborious,  slow  and  costly. 

The  first  Murray  River  settlement  was  located  at  a  place 
called  Lyrup.  The  state,  besides  alloting  land,  advanced 
tools,  shelter,  subsistence.  The  law  under  which  the  settle- 
ments were  made  had  been  so  framed  that  the  people  could 
organise  their  communities  as  they  chose — individualisti- 
cally,  co-operatively,  communistically. 

"There  was  a  wave  of  communistic  feeling  at  that  time 
all  through  Australia,"  one  of  the  men  prominent  in  this 
work  said  to  me,  "and  this  made  itself  felt  in  the  organisa- 
tion of  these  colonies,  which  at  the  start  were  all  co-operative 
and  some  of  them  communistic." 

Murtho  was  one  of  these  communistic  settlements,  but 
the  communistic  features  were  dropped  in  three  weeks,  and 
by  this  time  the  co-operative  and  communistic  features  have 
been  practically  abandoned  in  all  the  settlements. 


222  TRAMPS    MADE   TAXPAYERS 

By  the  original  act  the  Treasury  advanced  only  fifty  per 
cent,  of  the  cost  of  the  experiments,  and  the  men  were  en- 
tirely free  to  manage  their  own  affairs;  but  the  colony 
was  induced  to  go  in  deeper,  and  has  now  an  indebtedness 
charged  against  the  settlements  of  about  $500,000.  This 
mistake,  which,  it  will  be  observed,  is  quite  different  from 
the  New  Zealand  method,  has  led  to  another.  The  gov- 
ernment, to  secure  itself  for  the  debt,  has  taken  in  charge 
the  selling  of  the  produce  of  the  colonies,  and  the  buying 
of  their  supplies.  The  colonists  are  now  obliged  to  turn 
over  everything  to  it.  It  has  "degraded  them,"  as  one 
of  its  own  officers  phrased  it.  It  is  admitted  on  all  hands 
that  the  men  work  hard,  but,  work  as  hard  as  they 
will,  they  see  little  prospect  of  getting  ahead  of  their  in- 
debtedness. They  are  allowed  to  handle  no  money,  ex- 
cept a  few  pounds  which  they  are  allowed  out  of  their  earn- 
ings, almost  as  if  it  were  a  gratuity.  They  are  paid  wages 
for  their  work,  but  not  in  money.  They  are  given  fifteen 
shillings  a  week  for  subsistence,  to  be  taken  out  of  the  stores. 
Whatever  they  earn  in  excess  of  fifteen  shillings — and  many 
earn  thirty  shillings  a  week — is  credited  them  as  a  fund  out 
of  which  they  can  draw  for  extras,  like  implements,  houses, 
extensions,  etc. 

The  experience  of  the  settlers  of  Moorook  may  be  taken 
as  a  fair  illustration  of  the  results  of  this  method  of  state 
installation  of  co-operative  village  life.  The  settlers  at 
Moorook,  like  all  in  these  River  Murray  settlements,  were 
labourers  taken  out  of  the  streets  and  given  but  little 
more  direction  than  they  could  find  within  themselves. 
Still,  with  all  these  disadvantages  they  made  a  success,  so 
far  as  proving  that  the  land  they  had  chosen  was  fit  for 
agriculture — indeed,  with  proper  irrigation,  admirably 
adapted  both  for  grain  and  fruit.  There  were,  of  course, 
many  internal  difficulties  associated  with  this  attempt  of 


A  FATAL  INTERFERENCE  223 

strangers  and  men  without  practical  knowledge  of  previous 
co-operative  experience  to  organise  co-operative  life,  but  all 
the  best  observers  of  the  movement  believe  that  they  would 
have  succeeded  had  it  not  been  for  the  disastrous  features 
of  state  interference. 

"We  all  knew  the  government  could  establish  successful 
beggar  colonies,"  said  one  of  the  members  of  the  South 
Australian  Parliament,  "outdoor  poorhouses,  but  here  was 
an  attempt  to  place  the  unemployed  on  the  land  and  make 
permanent  settlers  of  them  on  co-operative  lines.  It  was 
the  most  advanced  experiment  in  the  world.  In  many  cases 
these  settlers  proved  themselves  more  skilful  even  than  the 
experts  who  were  sent  to  direct  them." 

The  settlement  at  Moorook  had  just  broken  up  when  I 
reached  Adelaide.  The  Minister  of  Lands  had  a  short  time 
before  interfered  and  said  the  settlers  must  leave  their  earn- 
ings with  the  department.  The  men  pointed  out  that  they 
could  not  buy  to  as  good  advantage  through  it  as  by  them- 
selves, for  the  dealers  who  sold  to  them  through  the  Min- 
ister would  charge  them  prices  so  high  that  they  could 
not  live.  In  the  case  of  some  of  the  adjoining  settlements 
the  members  had  not  proved  themselves  to  be  particularly 
steady  men,  and  to  hold  their  money  might  perhaps  have 
been  helpful,  as  it  made  it  impossible  for  them  to  throw  it 
away.  But  in  the  case  of  Moorook  it  was  fatal.  The  men 
there  were  trusty,  and  were  too  independent  to  submit  to 
such  interference.  Nine  out  of  thirteen  left.  They  and 
their  friends  urged  that  a  different  ruling  be  made  in  their 
case  from  that  applied  to  the  other  settlements,  but  fruit- 
lessly. The  Minister,  acting  on  the  merely  financial  aspects 
of  the  matter,  and  seeing  that  the  men  were  spending  more 
than  they  were  receiving,  insisted  that  they  could  not  con- 
tinue "on  their  own,"  as  the  Australian  phrase  is.  There- 
upon they  gave  up  their  land,  and  thousands  of  bushels  of 


224  TRAMPS    MADE   TAXPAYERS 

onions,  potatoes,  and  other  produce  which  they  had  raised 
were  left  rotting  on  the  ground. 

This  result  is  what  any  co-operative  adviser  familiar  with 
the  causes  of  success  and  failure  in  co-operation  elsewhere 
would  have  predicted  as  inevitable  the  moment  the  officials 
began  to  take  charge  of  trie  sales  and  purchases  of  the  men. 
It  is  an  illustration,  however,  of  the  cheapness  of  co-opera- 
tive living,  of  the  productiveness  of  co-operative  methods, 
and  the  wealth  that  lies  awaiting  the  union  of  labour  and 
land,  that,  with  all  these  vicissitudes  and  mistakes,  these  set- 
tlements have  already  resulted  in  an  unquestionable  eco- 
nomic gain  to  the  colony. 

The  report  of  the  surveyor-general  for  1898  reports  sat- 
isfactory progress.  The  total  area  under  cultivation  in  all 
the  settlements  had  been  increased  from  4829  to  6585  acres, 
and  the  total  value  of  the  improvements  is  $323,840,  and 
he  sees  "no  reason  why  the  settlements  should  not  be  a  de- 
cided success." 

But  they  are  no  longer  illustrations  of  the  co-operative 
idea  they  were  founded  to  vindicate.  The  strong  men  are 
shouldering  out  the  weak  ones,  with  the  idea  of  absorbing 
all  that  has  been  done.  At  Pyap  I  learned  the  members 
are  charging  a  premium  to  any  new  member,  unless  he  is  an 
artisan,  like  a  carpenter  or  blacksmith,  for  whom  they  have 
a  great  need. 

"The  settlements  will  die  one  after  another,"  an  official  of 
the  Land  Department  said  to  me.  "The  land  will  be  of- 
fered for  lease  to  whoever  best  shows  his  ability  to  pay  a 
fair  interest  on  the  cost  of  the  improvements." 

One  service  which  it  is  recognised  that  all  these  efforts  of 
the  workingmen  and  their  friends  have  done  the  community 
is  that  they  have  practically  added  a  new  territory  to  the 
colony.  "UpWard  of  eighty  thousand  acres  of  Murray 
River  land,"  says  Premier  Kingston,  "that  were  never  put 


A   GREAT   MONEY   MAKER  225 

to  use  before  have  been  taken  up  by  farmers  since  the  estab- 
lishment of  the  settlements,  owing  to  what  the  settlers  have 
done  in  the  way  of  proving  the  possibilities  of  the  district." 

The  Premier  repelled  the  criticisms  that  too  much  had 
been  done  to  help  the  unemployed  establish  themselves,  their 
wives  and  children  in  homes  on  the  banks  of  the  Murray. 

"We  did  not  extend  to  them  one  half  the  concessions," 
he  said,  "which  have  been  extended  at  different  times,  and 
justly  extended,  to  more  powerful  and  influential  classes 
who  did  not  stand  so  much  in  need  of  it." 

"The  village  settlements  are  doing  well  enough,"  the  Pre- 
mier said  to  me,  but  in  saying  this,  of  course,  he  referred 
simply  to  the  material  results.  These  settlements  can  no 
longer  serve  as  illustrations  of  what  men  can  do  in  co- 
operative or  communal  life. 

But  even  the  broken  bits  of  this  co-operative  experiment 
arrange  themselves  in  the  kaleidoscope  so  as  to  re-enforce 
all  previous  experience  of  the  extraordinary  wealth-produ- 
cing power  of  co-operative  effort.  In  fact,  the  greatest  diffi- 
culty with  co-operation  is  not  that  it  does  not  produce  wealth 
fast  enough,  but  that  it  produces  it  too  fast.  Co-operative 
and  communistic  societies  do  not  stay  poor  long  enough  to 
give  their  members  a  chance  to  grow  together. 

This  bit  of  verse  which  is  floating  about  South  Australia 
shows  that  some  one  has  been  able  to  get  a  laugh  out  of 
the  serious  side  of  these  efforts : 

THE   SETTLER'S   ELYSIUM 

"A  village  settler's  is  the  life  for  me, 
If  it  is  all  that  it's  cracked  up  to  be. 
I  want  a  place  where  corn,  and  wine,  and  hoil 
Is  bustin'  up  promiscuous  from  the  soil ; 
Where  hens  and  turkeys  run  about  in  freedom, 
And  no  one  ain't  a-troubled  for  to  feed  'em; 


226  TRAMPS    MADE   TAXPAYERS 

Where  cows  produces  butter,  milk,  and  cheese, 
Just  all  according  to  the  teat  you  squeeze ; 
Where  calves  are  never  born,  but  only  oxes, 
And  fruit  grows  dried  and  packed  in  little  boxes ; 
Where  'all- wool  goods'  straight  from  the  sheep  is 

taken, 

And  rashers  planted  springs  up  'ams  and  bacon; 
A  place  of  calm  delight  and  innocence, 
Where  everything  but  labour  is  intense; 
Where  Gov'ment  spends  all  that  must  be  spent, 
And  at  the  proper  time  remits  the  rent, 
And  follerin'  out  the  principles  as  we  hold, 
Finally  gives  a  man  his  little  freehold. 
A  spot  where  all  is  pleasant,  nothin'  rilin', 
Just  like  a  poetry  village,  allus  'smilin' ' ; 
A  sort  of  half-way  station  to  the  skies, 
A  workman's  genooine,  earthly  paradise. 
If  this  will  stop  the  country  goin'  to  pot, 
Send  me,  I  am  a  hardent  patriot!'' 


New  South  Wales  also  tried  co-operative  colonies  after 
the  panic  of  1893.  The  unemployed,  enlisted  from  the 
streets  indiscriminately,  were  sent  out  to  live  together  and 
work  together  on  new  land,  in  the  belief  that  their  poverty 
would  be  bond  enough  to  hold  them  together.  Any  one 
who  knows  the  infinite  patience  and  almost  infinite  failures 
by  which  alone  the  co-operators  of  England,  France  and 
Germany,  though  men  of  the  same  trades  and  nationality, 
have  been  able  to  build  co-operation  to  the  magnificent  thing 
it  is  now,  would  know  what  must  be  the  end  of  such  a 
venture. 

Just  before  I  reached  Sydney  the  Minister  of  Lands, 
under  whose  charge  these  co-operative  settlements  were,,  had 
issued  an  order  discontinuing  the  co-operative  feature.  Of 
course  this  put  an  end  at  once  to  that  side  of  the  settlement 
life  which  was  alone  of  any  unique  interest.  As  in  South 


HOW   TO   KILL   CO-OPERATION          227 

Australia,  these  settlements,  though  failing  co-operatively, 
have  not  failed  financially. 

The  whole  story  was  told  me  in  Sydney  of  the  causes  of 
failure  on  the  co-operative  side:  the  jealousies  of  the  men, 
the  incompetence  of  many  of  them,  the  poor  soil  mistakenly 
chosen  on  "expert  advice,"  the  grudgingness  of  the  disburse- 
ment of  the  money  by  the  Treasury  to  the  settlers,  the  ac- 
tive and  passive  opposition  of  the  officials,  the  illegal  and 
certainly  impolitic  and  unjust  expulsion  by  the  department 
of  the  single  men  who  were  doing  the  most  unselfish  work 
of  all,  as  they,  with  no  families,  shared  with  the  married 
men ;  the  resignation  in  a  body  of  the  citizens'  committee  in 
charge  of  the  settlements,  as  they  could  get  neither  hearing 
nor  help  from  the  Minister  of  Lands;  and  finally  the  order 
discontinuing  the  co-operative  regime  altogether,  and  drop- 
ping the  settlements  to  the  level  of  the  ordinary  individual- 
istic life  of  the  outside  world. 

Government  endowment  of  co-operative  settlements 
proved  as  disastrous  as  private  endowment  of  co-operation 
has  always  done.-  Every  one  of  the  co-operative  societies 
so  generously  endowed  by  the  Christian  Socialists  of  Eng- 
land, in  the  time  of  E.  Van  Sittart  Neale,  failed.  The  re- 
sult of  this  method  of  establishing  co-operation  is  pithily 
summed  up  in  the  phrase  current  among  English  co-opera- 
tors that  "to  subsidise  co-operation  is  to  kill  it."  The  most 
that  the  political  or  private  friends  of  co-operative  effort 
can  do  is  to  teach  it. 

The  Schultze-Delitsch  and  Raffeisen  banks,  which  have 
spread  all  over  continental  Europe  during  this  generation, 
would  not  have  outlived  the  nursing  bottle  if  Schultze- 
Delitsch  and  Raffeisen  had  loaned  the  people  the  capital  to, 
start  with.  It  is  by  keeping  close  within  the  lines  of  this 
policy — to  teach  co-operation,  never  to  endow  it — that  the 
Honourable  Horace  Plunkett  has  been  able  to  achieve  his 


228  TRAMPS    MADE    TAXPAYERS 

remarkable  work  in  the  creation  of  a  new  industrial  life  in 
Ireland.  Co-operation  was  made  a  living  thing  in  the  eco- 
nomic system  of  the  colonies  of  New  Zealand  and  Victoria 
and  Canada,  because  the  government  taught  the  farmers 
how  to  co-operate,  but  left  them  to  do  the  co-operating 
themselves  at  their  own  expense. 

The  most  thorough  plan  having  any  official  character 
which  has  yet  been  promulgated  for  the  radical  treatment  of 
the  unemployed  question  in  Australia  comes  from  the  colony 
of  New  South  Wales.  As  the  result  of  the  failure  of  the  co- 
operative villages  we  have  mentioned  and  to  provide  for  a 
social  evil  which  it  is  recognised  is  chronic  in  our  modern 
civilisation,  New  South  Wales  appointed  last  year  a  board 
called  the  Unemployed  Advisory  Board.  This  is  to  advise 
what  permanent  policy  to  adopt,  and  to  carry  out  such  of 
its  recommendations  as  may  be  accepted  by  Parliament  and 
the  public.  It  consists  of  three  ministers  of  the  Crown  and 
nine  other  members,  including  representatives  of  the  unem- 
ployed, members  of  Parliament  and  labour  organisations, 
and  some  of  the  best  known  clergymen  and  other  citizens. 
It  is  given  "power  to  carry  out  the  work,  subject  in  all  re- 
spects to  the  approval  of  the  Governor-in-Council." 

This  board  made  its  report  in  September,  1899.  Its  rec- 
ommendations, based,  as  they  are,  on  the  recent  experience 
of  New  South  Wales  itself  and  the  other  colonies,  and  made 
in  full  view  of  what  has  been  done  everywhere  else,  espe- 
cially in  New  Zealand,  certainly  have  the  importance  of 
news  of  a  high  sociological  value  to  statesmen  and  reform- 
ers the  world  over. 

It  proposes,  first,  an  extensive  scheme  of  "reproductive 
public  works" — reproductive,  it  will  be  observed,  not  of  the 
kind  seen  in  1895,  m  Sydney,  when  thousands  of  men  were 
scraping  the  paint  off  the  fences  or  hauling  sand  from  one 
place  to  another  in  the  public  parks  and  back  again,  just  to 


THE   NEW   SOUTH   WALES   PLAN        229 

"make  work."  Those  public  works  are  to  be  managed  on 
the  co-operative  system  adopted  in  New  Zealand,  which  the 
board  says  has  "had  highly  satisfactory  results,  both  to  the 
men  employed  and  to  the  government." 

The  programme  of  the  board  includes  such  enterprises 
as  planting  the  public  lands  with  trees,  clearing  and  draining 
them  for  settlement,  the  storage  and  supply  of  water  for 
mining,  building  bridges,  making  railroads,  highways,  and 
tram  lines,  which,  in  New  South  Wales,  are  owned  by  the 
national  government,  all  of  which,  if  properly  managed, 
would  add  more  than  their  cost  to  the  value  of  the  property 
of  the  people. 

The  board  further  recommends : 

First.  A  National  Intelligence  Department  for  men  and 
women. 

Second.  Labour  depots  where  the  unemployed  can  be 
temporarily  shelterd  and  employed. 

Third.  Industrial  Farm  Settlements — an.  expansion  of 
the  labour  depot — where  the  men  are  given  work  and  tech- 
nical instruction,  and  are  sifted  out  into  incapable  and 
capable. 

Fourth.  Assisted  Settlement  Blocks,  where  the  men  who 
graduate  from  the  Industrial  Farm  Settlements  are  given 
farms  of  their  own. 

Fifth.     Compulsory  Labour  Farms  for  the  vagrants. 

In  addition  to  this,  the  board  proposes  subsidies  to  the 
prospectors — "fossickers" — in  mineral  fields ;  systematic  em- 
ployment for  the  men  in  the  public  institutions  who  may 
be  found  fit  for  such  effort,  calculated  to  be  half  the  total 
number  of  inmates;  advances  to  settlers  to  prevent  their 
ruin  at  the  hands  of  the  usurer,  who  is  a  constant  source 
of  supply  of  unemployed;  allotment  of  land  to  societies 
formed  to  settle  co-operatively;  treasury  advances  for  the 
establishment  of  co-operative  industries  in  the  Assisted  Set- 


230  TRAMPS    MADE   TAXPAYERS 

tlement  Blocks;  and,  finally,  and  not  the  least  important, 
instruction  in  agriculture  for  all  the  primary  schools  in  the 
colony. 

The  board  ascertained  by  their  inquiries  among  the  in- 
mates of  the  various  charitable  institutions  of  the  colony 
that  a  very  large  majority — eighty-seven  per  cent. — of  the 
workingmen  who  had  had  to  seek  help  were  unskilled  la- 
bourers, who  had  never  had  any  sort  of  technical  education, 
skilled  training  or  instruction  in  any  trade  or  calling.  Of 
the  skilled  workmen  a  very  small  proportion  were  pau- 
pers. It  was  this  striking  illustration  of  the  value  of  tech- 
nical training  that  led  the  board  to  urge  the  "desirability 
of  extending  a  system  of  agricultural  instruction  to  our  pri- 
mary schools.  In  view  of  our  belief  that  to  a  large  extent 
the  land  offers  the  best  means  of  permanently  solving  the 
unemployed  question,  we  consider  the  sooner  that  attention 
is  given  to  the  instruction  offered  youth  in  using  the  land  to 
the  best  advantage,  the  more  success  will  attend  the  efforts 
in  the  direction  of  agricultural  pursuits." 

The  board  recommends  the  compulsory  resumption  by 
the  state  of  drainable  areas,  suitable  for  agriculture,  which 
have  been  neglected  by  the  private  owners. 

The  labour  depot  proposed  by  the  Unemployed  Advisory 
Board  of  New  South  Wales  resembles  the  state  farm  which 
the  New  Zealand  government  has  established  at  Levin.  The 
colony  of  Victoria  has  also  something  like  the  labour  depot 
in  a  state  farm  at  Leongatha.  This  is  founded  on  the  plan 
of  the  well-known  German  labour  colonies.  It  contains 
800  acres,  admirably,  equipped  with  buildings  and  agri- 
cultural machinery  of  the  best  type.  The  smallest  num- 
ber of  men  who  have  been  there  at  one  time  is  forty-seven, 
the  largest  346.  When  I  was  in  Victoria  the  number  being 
entertained  was  150,  an  increase  due  to  the  return  of  miners 
from  the  gold  fields  of  West  Australia.  The  average  stay 


A   KEY-NOTE   OF    STATESMANSHIP       231 

of  the  men  is  three  months.  Sixty  per  cent,  of  them,  I  was 
told  by  Colonel  Goldstein,  who  is  in  charge  of  the  farm, 
were  drunkards.  No  one  over  fifty-five  years  old  is  re- 
ceived. Victoria  at  one  time  established  a  few  settlements 
for  the  unemployed,  and  made  some  advances  of  money, 
but  this  has  now  been  discontinued. 

The  most  important  function  of  the  Industrial  Farm  Set- 
tlements thus  proposed  in  New  South  Wales  is  to  do  all 
the  preliminary  work  of  clearing,  road  making,  building, 
etc.,  to  prepare  for  use  the  land  which  is  to  be  made  into 
the  Assisted  Settlement  Blocks.  The  pay  of  the  Industrial 
Farm  settlers  is  not  given  them  in  money,  but  in  the  form 
of  board,  residence,  clothing,  etc.,  in  proportion  to  the  work 
they  do.  These  Assisted  Settlement  Blocks  are  not  to  be 
sold,  but  rented.  The  rent  is  to  be  two  and  one  half  per 
cent,  on  the  unimproved  value  of  the  land.  No  rent  is  to 
be  paid  for  the  first  two  years.  All  the  improvements 
which  have  been  put  upon  the  land  by  the  state  in  the  way 
of  clearing,  etc.,  are  made  a  charge  on  the  land  and  are 
paid  for  by  the  tenant  in  annual  instalments  extending  over 
a  period  of  twenty  years,  with  interest  at  the  rate  of  four 
per  cent,  on  the  unpaid  balance. 

The  report  does  not  emphasise  it,  but  it  is  to  be  taken 
for  granted  that,  as  is  done  in  New  Zealand  wherever  pos- 
sible, the  public  works  and  the  settlement  of  the  land  shall 
be  made  to  go  hand  in  hand — the  labour  that  builds  the 
highways,  railroads,  bridges,  settling  down  on  the  land 
alongside;  the  wages  the  government  pays  the  workingmen 
enabling  them  to  become  permanent  contributors  to  the  reve- 
nue of  the  railroads  and  public  buildings  they  have  erected. 
In  this  policy  and  not  in  the  subsidisation  of  industry  will 
be  found  the  key-note  of  successful  statesmanship  in  deal- 
ing with  the  problem  of  the  unemployed. 

Since  these  plans  of  the  Unemployed  Advisory  Board 


232  TRAMPS    MADE   TAXPAYERS 

were  made  and  submitted  there  has  been  a  change  of  min- 
istry in  New  South  Wales.  The  new  government  has  ap- 
pointed a  commission  to  carry  out  the  proposals,  but,  sin- 
gularly enough,  has  put  upon  it  only  one  member  of  the 
board  which  prepared  them.  "It  is  a  great  pity,"  one  of 
the  board  writes,  "that  those  who  conceived  these  plans 
should  not  have  been  allowed  to  take  part  in  executing 
them." 


CHAPTER   X 

A    COUNTRY    WITHOUT    STRIKES 

ALL  the  Australasian  colonies  have  labour  parties  more  or 
less  strong,  generally  less,  and  labour  legislation  more  or 
le$s  advanced,  generally  less.  Only  two  colonies  have  any- 
thing to  show  that  could  be  called  novelties  in  this  field — 
Victoria  and  New  Zealand.  Australasia  is  commonly 
spoken  of  as  if  it  were  run  by  the  workingmen,  and  run 
hard.  But  the  least  observing  traveller  finds  at  once  that 
nothing  could  be  further  from  the  truth  than  that  the  work- 
ingman  is  the  master  anywhere  in  Australia  or  New  Zealand. 
These  are  not  labour  countries,  and  their  advanced  institu- 
tions are  not  due  to  labour  parties.  While  I  was  in  Mel- 
bourne the  trades-unions  were  refused  permission  by  the 
mayor  to  parade  the  streets  in  the  celebration  of  their  eight- 
hours  holiday.  The  best  they  could  get  was  the  left- 
handed  intimation  that  if  they  "strolled"  through  the  streets 
they  would  not  be  molested.  The  year  before  the  mayor 
had  declined  to  allow  a  room  in  the  town-hall  to  be  used 
for  a  meeting  of  citizens  investigating  the  unemployed 
question.  In  Melbourne  the  workingman  has  an  almost 
magnificent  trades  hall,  as  a  monument  of  former  grandeur, 
covering  a  large  area,  with  a  fine  and  expensive  building, 
but  everywhere  now  about  it  are  evidences  of  discourage- 
ment and  decay.  The  fact  is  that  nowhere  in  Australasia 
have  the  workingmen  recovered  from  the  effects  of  their 
crushing  defeat  in  the  strike  of  1890.  In  New  Zealand  the 

233 


234        A   COUNTRY   WITHOUT   STRIKES 

people,  including  the  workingmen,  turned  this  defeat  into  a 
victory  by  making  it  the  occasion  of  a  renaissance  of  reform 
which  it  has  been  the  province  of  this  book  to  chronicle, 
but  no  equally  fortunate  issue  followed  in  the  other  colo- 
nies. The  impulse  was  felt  in  New  South  Wales  and  else- 
where in  Australia,  but  it  reached  only  a  scanty  realisation. 

The  workingmen  have  not  yet  been  able  to  establish  the 
eight-hours  day  by  law  in  any  colony,  and  have  to  content 
themselves  with  the  general  observance  maintained  by  the 
best  trades-unions  by  the  simple  strength  of  organisation. 
Within  these  limits  the  institution  is  firmly  established.  I 
was  informed  by  the  officials  of  the  Public  Works  Depart- 
ment in  New  South  Wales  that  it  was  not  necessary  in  mak- 
ing out  specifications  for  contractors  to  stipulate  for  the 
eight-hours  day,  as  its  observance  was  a  matter  of  course  in 
the  building  trades.  The  interest  of  the  workingmen  demand 
universal  observance  of  the  eight-hours  day,  but  the  law 
by  which  alone  this  could  be  had  the  labour  parties  have 
nowhere  been  strong  enough  to  get  enacted.  Nowhere, 
either  in  Australia  or  New  Zealand,  is  there  a  labour  party 
which  has  ever  had  a  majority  in  Parliament,  and  no  labour 
party  has  ever  been  able,  by  the  most  skilful  tactics,  either  of 
fusion  or  independence  or  the  "squeezing  policy" — support- 
ing either  party  in  return  for  concessions — to  hold  the  bal- 
ance of  power  for  more  than  a  moment,  or,  during  that  mo- 
ment, to  secure  any  really  radical  legislation.  Even  in  New 
Zealand  the  initiative  in  its  industrial  legislation,  which  is 
minute  and  advanced,  is  not  to  be  credited  to  a  labour 
party. 

It  is  in  New  South  Wales  that  the  most  promising  polit- 
ical organisation  of  the  workingmen  has  been  developed. 
In.  1 89 1  the  workingmen  of  that  colony  elected  thirty-five 
out-and-out  labour  representatives  to  the  new  Parliament 
containing  one  hundred  and  forty-one  members.  The  ap- 


THE    FIGHTING    PLATFORM  235 

pearance  of  a  distinct  labour  party  so  strong  in  numbers  and 
strong,  too,  in  character  and  intelligence,  was  an  event  at- 
tracting attention  all  over  the  world.  There  were  great 
expectations  in  Australia  and  abroad  of  the  reforms  which 
would  follow,  but  the  new  party  was  split  at  the  very  open- 
ing of  its  career.  Its  opponents  cunningly  introduced  a 
question  involving  the  venerable  issue  of  free  trade  and  pro- 
tection, and  a  quarter  of  the  labour  members  deserted  their 
party  and  supported  the  ministry,  as  it  supported  the  tariff. 
The  other  labour  members  were  of  shrewder  stuff  and  voted 
with  one  party  for  protection,  to  get  the  electoral  reform 
of  "one  man,  one  vote,"  and  voted  with  another  party  for 
free  trade  to  get  the  land-tax. 

The  labour  party  of  New  South  Wales  still  survives.  Its 
manifesto  of  1898  shows  a  membership  in  Parliament  of 
nineteen.  It  has  done  good  work  and  has  been  instrumen- 
tal in  overturning  several  ministries,  as  that  of  Sir  Henry 
Parkes  of  1892  and  the  Reid  ministry  of  1899.  Its  influ- 
ence was  important  in  such,  legislation  as  the  reform  of 
the  suffrage,  the  abolition  of  the  contractor  in  many  gov- 
ernment works,  and  numerous  improvements  in  land  and 
labour  legislation,  but  it  cannot  be  said  to  have  added  any 
such  notable  things  to  the  list  of  realised  radicalism  as  New 
Zealand  has  done. 

That  the  labour  members  have  used  their  Parliamentary 
power  with  great  conservatism  is  sufficiently  plain.  "The 
ministry  of  1899,"  I  was  assured  by  one  of  the  labour  mem- 
bers of  New  South  Wales,  "is  absolutely  dependent  on  the 
labour  vote."  But  with  this  supremacy  the  labour  men 
have  made  no  demands  that  could  be  called  radical.  The 
labour  party  of  New  South  Wales  is  known  as  the  Political 
Labour  League,  and  puts  forth  two  platforms.  One  is  called 
the  "fighting  platform,"  and  the  other  is  the  "platform." 
The  "platform"  contains  the  whole  list  of  the  social  de- 


236        A   COUNTRY   WITHOUT    STRIKES 

mands  which  the  workingmen  would  like  to  see  established 
by  political  means,  and  includes  such  things  as  free  medical 
services  for  every  one  and  the  nationalisation  of  mines, 
land,  banks  and  railroads.  In  fact,  it  adopts  the  phrase  of 
the  German  Socialist  Labour  Party  and  calls  for  nationali- 
sation of  "the  means  of  production,  distribution  and  ex- 
change." The  "fighting  platform"  puts  forward  only  those 
things  which  it  is  proposed  to  make  immediate  issues.  The 
"fighting  platform"  of  1898,  for  instance,  mentions  only 
one  of  the  radical  issues  just  quoted  from  the  "platform." 
It  puts  forward  as  the  first  matters  to  be  pushed  through 
Parliament  the  abolition  of  the  upper  house,  the  adoption 
of  the  initiative  and  referendum,  a  national  bank,  old-age 
pensions  and  local  government  How  little  foothold  the 
labour  men  really  have  in  Australia  is  shown  by  the  fact 
that  in  the  face  of  this  strong  political  organisation  of 
labour  in  New  South  Wales  the  government  does  not  rec- 
ognise the  trades-unions  even  of  its  own  employes.  I  have 
told  elsewhere  the  story  of  the  treatment  of  the  tram-car 
men  of  Sydney.  The  Minister  for  Public  Works  does  not 
treat  with  his  employes  through  their  organisations.  "But 
we  ascertain  their  standard  of  wages  and  conditions  and 
approximate  them  as  closely  as  we  can." 

The  two  landmarks  in  labour  legislation  in  Australasia 
are  the  minimum  wage  law  of  Victoria  and  the  compulsory 
arbitration  court  of  New  Zealand.  The  minimum  wage 
law  of  Victoria,  so  far  as  it  goes,  has  a  purpose  similar  to 
that  of  the  compulsory  arbitration  law  of  New  Zealand — to 
protect  the  livelihood  of  the  people.  But  it  does  not  go 
very  far,  nor,  so  far  as  it  goes,  does  it  go  very  well.  This 
legislation  was  the  response  of  Parliament  to  shocking  reve- 
lations of  the  misery  being  spread  through  Melbourne  and 
other  towns  in  Victoria  by  the  sweating  system.  Its  pur- 
pose is  to  take  away  the  power  of  the  sweater  to  depress 


A  LIVING   WAGE   LAW  237 

wages  below  the  living  point.  It  might  be  called  a  ''living 
wage  law  limited."  It  is  designated  in  the  report  of  the 
chief  inspector  of  factories  as  an  attempt  to  deal  with  the 
sweating  evil  and  intended  to  put  an  end  to  the  "uncon- 
trolled competition"  by  which  "inconceivable  misery"  is 
brought  to  those  who  are  "earning  only  a  precarious  daily 
wage."  The  initiative  is  not  given  to  the  people,  as  it  is 
in  the  New  Zealand  arbitration  law,  but  to  the  governor 
and  council.  In  a  similar  way  the  machinery  of  the  South 
Australian  arbitration  law  was  to  be  set  in  motion  by  the 
state,  not  by  the  parties  to  an  industrial  dispute,  and  the  law 
remains  inoperative.  The  Governor  of  Victoria,  when  con- 
vinced that  the  depression  of  wages  and  conditions  of  labour 
in  any  trade  have  become  a  matter  of  public  concern,  has 
the  power  to  order  the  election  of  a  "special  board"  to  fix 
a  figure  below  which  wages  shall  not  be  pushed.  These 
boards  contain  an  equal  number  of  representatives  of  em- 
ployers and  employes,  as  the  New  Zealand  arbitration 
boards  and  court  do,  and  each  side,  as  in  New  Zealand,  elects 
its  own  representative,  and  these  representatives  then  choose 
a  chairman.  The  boards  are  called  "special  boards"  because 
each  takes  cognisance  only  of  the  special  trade  for  which 
it  was  appointed. 

Up  to  the  present  time  five  of  these  boards  have  been 
constituted,  one  each  in  the  baking,  men's  and  boys'  clothing, 
boots  and  shoes,  shirts,  cuffs  and  collars,  and  furniture 
trades,  and  they  are  given  by  law  authority  to  investigate 
the  conditions  of  the  trade  for  which  they  are  appointed 
and  to  determine  the  lowest  prices  or  rates  which  shall  be 
paid  to  any  person  engaged  therein.  These  rates  or  wages 
become  legally  enforceable  on  a  date  fixed  by  the  board. 
These  boards  are  in  fact  compulsory  arbitration  boards  for 
the  trades  concerned.  They  differ  radically,  however,  from 
the  compulsory  arbitration  tribunals  of  New  Zealand,  for 


238 

these  have  the  power  to  fix  all  wages,  as  well  as  the  mini- 
mum, and  act  upon  the  initiative  of  the  people,  and  have 
much  greater  authority  than  the  Victorian  boards. 

The  New  Zealand  compulsion  is  not  merely  compulsion 
to  obey  the  award.  There  are  other  compulsions  equally 
valuable,  and  in  fact  indispensable.  Not  the  least  of  these 
are  compulsory  publicity,  with  the  powers  of  compelling  the 
attendance  of  witnesses  with  the  production  of  books,  and 
the  compulsion  which  compels  disputants  to  refer  their  cases 
to  arbitration.  Under  the  Victorian  law,  up  to  the  time  of 
the  last  report  of  the  chief  inspector  of  factories,  June  I, 
1899,  f°r  tne  vear  J898,  the  five  special  boards  had  made 
awards  affecting  10,635  employes,  and  had  increased  their 
wages  by  an  amount  estimated  at  $500,000  if  they  worked 
full  time.  In  the  baking  trade  the  minimum  was  fixed  at 
one  shilling,  twenty-five  cents,  an  hour  for  men  and  five 
shillings  a  week  for  apprentices.  This  was  an  increase  on 
the  average  of  $3.75  a  week  for  the  men.  There  was  no  in- 
crease in  the  price  of  bread  to  the  consumer.  In  the  cloth- 
ing trade  the  minimum  was  made  js.  6d.,  $1.87,  a  day  of 
eight  hours  for  the  men  and  eighty-three  cents  for  the 
women.  The  average  wages  of  4484  employes  were  in- 
creased sixty-eight  cents  a  week,  with  no  increase  in  the 
price  of  clothing — a  result  which  the  chief  inspector  con- 
siders "little  short  of  astounding." 

But  the  fact  that  the  minimum  rates  for  piece-work  out- 
side the  factories  were  fixed  too  high  led  the  manufacturers 
to  insist  that  outside  workers  should  become  factory  work- 
ers. Many  women  who  had  been  working  at  home  had 
to  go  into  the  factories.  They  have  found,  the  inspector 
says,  that  the  factories,  with  their  light,  sanitation,  warmth 
and  regulated  hours  were  better  places  than  their  own  homes. 
Those  who  could  not  go  into  the  factories  have  had  to  do 
without  work.  The  old  and  slow  workers  had  to  suffer  like 


THE  CHINESE   SMILE  239 

these  women.  The  minimum  proved  to  be  more  than  the 
manufacturers  were  willing  to  pay  these  incompetents,  with 
the  result  that  many  of  them  were  converted  into  tramps. 
Under  the  New  Zealand  compulsory  arbitration  law  the  ar- 
bitration court  has  the  power  to  fix  the  rates  at  which  the 
"incompetent"  men  can  be  employed,  and  the  Victorian 
boards  have  been  compelled  to  follow  this  precedent  and  al- 
low such  persons  to  work  for  less  than  the  official  minimum. 
The  export  trade  in  clothing  fell  off  during  the  year  of  mini- 
mum wages.  The  decent  manufacturers  gained  by  the  elim- 
ination the  law  achieved  of  the  unscrupulous  sweating  com- 
petitor, but  apparently  are  not  able  to  hold  the  foreign 
markets  in  competition  with  manufacturers  abroad  who 
have  no  minimum  wage  to  pay. 

In  the  boot  and  shoe  trade  the  special  board  at  first  re- 
duced the  wages  of  the  men  to  six  shillings  a  day  from 
7.?.  6d.,  but  afterward,  in  consequence  of  the  bitter  com- 
plaints of  the  workers,  increased  this  to  seven  shillings  a 
day,  $1.75,  despite  the  strenuous  opposition  of  the  employ- 
ers. This  determination  of  the  minimum  wage  has  in- 
creased the  average  pay  of  every  man,  woman  and  child 
in  the  trade  by  $1.08  a  week.  But  here  again  the  "poor" 
workmen  presented  a  stumbling  block.  The  rate  for  piece- 
work was  made  so  high  that  the  manufacturers  would  em- 
ploy only  young  and  strong  men,  and  the  "old  and  slow" 
men  had  to  go  on  the  street.  For  the  shirt,  collar  and  cuff 
makers  the  minimum  was  fixed  at  4^.  an  hour,  16^.  per 
week  of  forty-eight  hours. 

A  snag  was  struck  in  the  furniture  trade.  There  are 
a  number  of  Chinese  manufacturers  of  furniture  in  Vic- 
toria, and  the  department  has  found  it  impossible  either 
to  enforce  the  minimum  or  to  ascertain  what  wages  these 
Chinese  capitalists  really  pay  their  Chinese  labour.  The 
reports  they  make  to  the  government  claim  that  their 


240        A   COUNTRY   WITHOUT   STRIKES 

wages  average  $10.56  per  week,  against  $9  paid  by  the 
white  manufacturers.  These  Chinese  meet  the  inspector 
with  "the  smile  childlike  and  bland"  immortalised  by  Bret 
Harte,  and  insist  that  they  are  obeying  the  law.  "What 
can  be  done,"  the  inspector  asks,  "with  men  who  meet  you 
with  a  bland  smile  and  maintain  without  hesitation  or  doubt 
that  the  law  is  complied  with  when  you  are  morally  equally 
certain  that  the  law  is  broken  every  day  and  hour  in  the 
factory?  They  are  seldom  rude.  An  unfailing  politeness 
and  courtesy  marks  all  their  utterances,  but  with  the  view 
of  obtaining  information  an  officer  might  just  as  well  ques- 
tion the  furniture  they  make."  An  inspector  who  spoke 
Chinese  was  obtained,  but  he  was  as  helpless  to  penetrate 
the  Oriental  suavity  of  these  undoubted  law-breakers  as  the 
English  inspectors. 

Here  is  a  specimen  "determination"  made  by  one  of  these 
special  boards. 

(Extract  from  "Government  Gazette,"  April  2cl,  1897.) 
FACTORIES  AND  SHOPS  ACTS 

Determination  of  Special  Board  Appointed  to  Determine  the  Lowest  Price  or 
Rate  of  Payment  for  Bread-Making  or  Baking. 


In  accordance  with  the  provisions  of  the  Factories  and  Shops  Acts  the  Special 
Board  appointed  to  determine  the  lowest  price  or  rate  of  payment  for  bread- 
making  or  baking  has  made  the  following  determination,  namely: — 

1.  That  the  lowest  price  or  rate  of  payment  payable  to  any  person  for  bread- 
making  or  baking  shall  be  twelvepence  per  hour. 

2.  That  the  number  of  apprentices  under  the  age  of  eighteen  years  who  may 
be  employed  in  a  factory  or  work-room  in  the  bread-making  or  baking  trade 
shall  be  one  apprentice  to  every  three  men  or  fraction  of  three  men. 

3.  That  no  improvers  under  the  age  of  eighteen  years  shall  be  employed  in  a 
factory  or  work-room  in  the  bread-making  or  baking  trade. 

4.  That  the  lowest  price  or  rate  of  pay  payable  to  such  apprentices  shall  be 
not  less  than  five  shillings  per  week. 

5.  That  the  price  or  rate  determined  by  the  Board  shall  come  into  force  on 
the  3d  of  April,  1897. 

Dated  at  Melbourne,  the  15th  day  of  March,  1897. 

HARTLEY  WILLIAMS,  Chairman. 


PERJURY    IF   YOU   LIKE  241 

The  exports  of  furniture  have  declined  under  this  mini- 
mum wage  about  one  third,  but  this  can  be  explained,  the 
officials  think,  by  other  causes  than  the  law. 

"We  can  do  nothing  with  the  Chinese,  nor  with  some  of 
the  white  men,"  the  head  of  the  department  said  to  me;  and  I 
learned  not  only  from  the  officials  but  from  the  workingmen 
that  evasion  of  the  minimum  by  mutual  arrangement  be- 
tween the  men  and  the  masters  was  not  an  uncommon  thing. 
When  the  chief  inspector  asked  an  old  man  to  sign  a  decla- 
ration that  he  was  receiving  the  minimum  wages  as  declared 
by  the  special  board  in  his  trade,  the  inspector  says,  "He 
looked  me  fair  in  the  face  and  said,  'I  will  sign  anything 
you  like.'  What  he  meant  was,  'I  must  work,  and  to  get 
and  keep  the  work  I  will  commit  perjury  if  you  like.'  Can 
anything  be  sadder?  After  that  day  I  determined  that,  so 
far  as  I  could  help  it,  I  would  never  again  put  a  man  in 
such  a  position.  There  is  some  excuse  for  an  old  man. 
but  when  the  same  is  done  by  young  and  strong  men  one 
begins  to  ask,  how  can  Parliament  protect  the  men  against 
themselves  ?" 

Representatives  of  the  workingmen  whom  I  met  in  the 
fine  trades-union  hall  of  Melbourne  confirmed  this  statement 
of  the  chief  inspector.  "The  men,"  one  of  these  trades- 
union  leaders  said,  "lie  to  the  inspectors  about  their  wages." 
The  reasons  why  the  men  do  this  are  sufficiently  indicated 
by  the  story  just  quoted.  The  chief  inspector,  almost  in 
the  accents  of  discouragement,  asking  what  can  be  done  to 
remedy  the  straits  in  which  Victorian  industry  finds  itself 
under  this  law,  exclaims,  "The  only  answer  appears  to  me 
to  be  to  provide  work  at  remunerative  wages  for  men  able 
to  work  and  old-age  pensions  for  the  old-age  workers.  It 
is  no  doubt  very  easy  to  say  provide  remunerative  work, 
but  how  to  do  so  has  puzzled  the  wise  men  of  the  past,  and 
is  probably  the  greatest  of  the  difficulties  which  confront 
the  statesmen  of  the  present  day."  In  other  words,  the  only 


242         A  COUNTRY  WITHOUT  STRIKES 

remedy  lies  along  the  line  which  New  Zealand  has  already 
travelled  so  far  and  with  such  success  in  its  settlement  of 
the  unemployed  in  work  and  on  the  land  and  with  its  old- 
age  pensions  and  other  reforms. 

There  have  been  a  few  "labour  members"  in  the  New  Zea- 
land Parliament  for  many  years,  but  there  has  not  been  a 
well-organised  labour  party  as  in  Australia.  The  work- 
ingmen  of  New  Zealand  have  seldom  attempted  to  con- 
centrate their  vote  on  men  of  their  own  class,  but  have 
voted  for  the  representatives  who  seemed  to  them  to 
promise  best  for  the  people  at  large.  This  policy  has 
given  them  great  influence.  A  Liberal  who  wants  to 
run  for  Parliament  must  send  his  name  in  to  the  trades- 
union  conference  of  his  district.  If  they  do  not  approve  him 
it  is  of  no  use  for  him  to  stand.  In  the  tidal  wave  of  1890, 
when  the  Liberal  party  was  swept  into  the  ruling  position 
it  has  ever  since  maintained,  and  of  which  it  is  assured  until 
1903  by  the  election  of  last  year,  there  were  twenty  members 
who  owed  their  election  to  the  labour  vote,  but  there  were 
only  six  mechanics  among  them.  The  labour  members  in 
New  Zealand,  unlike  those  of  New  South  Wales,  Queens- 
land and  other  colonies,  have  uniformly  allied  themselves 
with  the  Liberals. 

Any  one  who  thinks,  from  an  outside  view,  that  the  New 
Zealand  government  is  a  labour  government  would  be  dis- 
illusioned instantly  by  getting  an  inside  view  of  the  atti- 
tude toward  the  labour  elements  held  by  some  of  the  prin- 
cipal members  of  the  New  Zealand  Liberal  Party.  A 
distinguished  Liberal  leader  told  me  he  had  found  the  labour 
programme  more  popular  and  better  understood  among  the 
farmers  than  among  the  workingmen.  He  insists  that  the 
country  people  are  the  real  mainstay  of  the  Liberal  policy. 
His  colleagues  predicted  to  him  that  he  would  go  down  be- 
fore his  country  constituency  with  the  Liberal  labour  pro- 


A   MINISTRY   OF   WORKINGMEN          243 

gramme  he  had  espoused;  but  he  found,  on  the  contrary, 
that  it  added  to  his  strength.  His  explanation  of  this  para- 
dox is  that  "the  country  voters  are  better  statesmen  than  the 
city  workingmen."  A  very  eminent  New  Zealand  politician 
rang  the  changes  on  the  workingmen's  weakness,  ignorance 
and  jealousy.  "With  my  early  associations  among  the  men 
I  know  how,  in  a  crowd  of  workingmen,  the  moment  a  com- 
rade begins  to  get  up,  to  have  some  new  ideas,  to  take  the 
lead,  his  fellows  begin  to  suspect,  to  ridicule  and  to  pull 
down."  One  of  the  most  undoubted  friends  of  the  labouring 
man,  speaking  with  the  reverse  of  enthusiasm  of  the  labour 
leader,  said,  "The  first  year  the  labour  leader  is  a  pretty 
good  sort  of  fellow;  he  has  high  aspirations,  is  unselfish 
and  patriotic.  The  second  year  he  appears  in  a  bell-topper 
hat  and  a  gold  chain.  The  third  year  he  is  invited  to  dinner 
by  the  members  of  the  upper  house,  and  on  the  fourth  year 
he  is  neither  fish,  flesh,  fowl  nor  good  red  herring." 

Members  of  the  Ministry  make  no  secret  of  their  dis- 
appointment over  the  fact  that,  with  all  their  labour  legis- 
lation, they  are  not  strongest  in  the  districts  where  the  work- 
ingmen are  strongest,  and  that  labour  leaders  put  into  the 
upper  house  to  give  strength  to  the  labour  programme 
oppose  the  government  instead  of  supporting  it.  These 
officials  and  leaders  who  criticise  the  workingmen  know 
the  class  well,  for  some  of  them  were  workingmen.  One 
of  the  Cabinet  said,  "All  the  members  of  the  present  Min- 
istry have  begun  at  the  bottom.  I  know  myself  what  it 
is  to  stay  out  all  night  in  the  bush  up  to  my  neck  in  mud 
and  slush.  This  is  a  ministry  of  workingmen  who  have 
resolved  that  the  government  should  do  something  to  bet- 
ter the  condition  of  the  common  people  from  whom  they 
sprang,  and  they  have  worked  faithfully  to  that  end." 

To  understand  the  relations  of  the  labourers  and  the  Lib- 
erals the  capital  fact  to  be  remembered  is  that  New  Zealand 


244         A  COUNTRY  WITHOUT  STRIKES 

alone,  of  all  the  Australasian  colonies,  is  not  city  ruled.  It 
is  not,  like  New  South  Wales  or  Victoria,,  a  citified  country, 
but  it  remains — and  its  conformation  guarantees  that  it 
will  always  remain — country.  There  are  no  large  cities 
and  can  be  none.  An  observer  from  abroad  notices  at  once 
that  the  leading  men  of  New  Zealand  are  not  the  sophisti- 
cated kind  he  finds  elsewhere  in  public  places.  There  is  a 
certain  rusticity — like  that  of  the  English  country  gentle- 
man— characteristic  of  the  best  New  Zealander  even  in  the 
cities,  and  in  this  unmetropolitanised  quality  is  to  be  found 
one  of  the  great  secrets  of  the  sincerity  and  success  of  New 
Zealand  reform. 

The  labour  legislation  of  New  Zealand  began  before  the 
labour  party  came  in,  as  far  back  as  1872,  though  in  a  very 
mild  form,  and  the  Conservatives  in  1890,  just  before  they 
lost  control  of  the  government,  had  introduced  some  new 
labour  measures.  The  movement  was  at  no  time  theoret- 
ical, but,  like  all  the  New  Zealand  reforms,  was  a  response 
to  the  pressure  of  real  evils.  But  though  New  Zealand 
did  not  act  prophetically,  nor  in  advance  of  the  appearance 
of  the  evil — why  should  it  be  counted  a  fault  in  a  nation 
any  more  than  in  a  person  to  be  forewarned? — it  acted 
almost  as  soon  as  the  evil  gave  its  first  intimation.  Even 
Earl  Onslow,  conservative  of  conservatives,  almost  harsh 
critic  of  the  New  Zealand  novelties,  points  out  how  the 
absence  of  vested  interests  permitted  the  country  to  carry 
out  needed  changes. 

Prescience,  however,  had  some  part  in  the  passage  of  the 
labour  laws,  and  it  had  more  there  than  in  the  land  laws. 
In  land  the  situation  of  the  people  of  New  Zealand  had  be- 
come desperate.  But  its  industrial  development  was  so 
slight  that  the  wrongs  to  be  remedied  were  felt  by  only  a 
few,  though  all  could  see  them.  In  the  first  debate  on  the 
factory  bills  their  passage  was  urged  even  more  on  the 


A   SPECTRE   WITH    SPURS  245 

• 

plea  of  avoiding  the  ills  which  had  undeniably  overtaken 
England  than  to  remedy  visible  ills  in  New  Zealand.  That 
some  evils  existed  and  that  they  had  created  some  heat 
may  be  inferred  from  the  remark  made  by  one  of  the  influ- 
ential supporters  of  the  administration  in  debate,  that  if 
the  needed  measures  were  not  passed  the  iron  hand  of  force 
would  be  used  to  deprive  property  owners  of  their  property. 
The  really  acute  phase  of  the  labour  problem,  and  the 
one  which  stirred  the  nation,  was  in  the  unemployed  diffi- 
culty. That,  even  before  1890,  strangely  enough  for  so 
young  a  country,  was  real,  terrible,  a  public  menace.  It 
was  due  primarily  to  the  monopoly  of  land,  but  it  made 
itself  felt  in  every  industrial  centre  of  the  country.  A 
royal  commission — they  have  royal  commissions  even  in  the 
colonies — had  reported  in  1890  that  there  was  no  sweating 
in  New  Zealand.  In  the  debate  on  the  labour  measures 
very  few  serious  evils  of  a  strictly  industrial  sort  were  dis- 
closed. The  condition  of  the  men  and  women  and  children 
in  the  shops  was  denounced  as  "perfect  slavery."  The 
shelter  and  food  given  the  nomadic  shearers,  who  go  about 
from  sheep  ranch  to  sheep  ranch  during  the  season,  were 
shown  to  be  almost  inhuman.  There  were  complaints  that 
the  workmen  were  paid  in  goods  at  truck  stores  instead  of 
in  cash.  The  deductions  of  insurance  money  from  the 
wages  of  workmen  were  a  grievance.  But  no  student  of 
New  Zealand  affairs  can  doubt  that  these  complaints  all  to- 
gether would  never  have  sufficed  to  generate  political  energy 
enough  to  move  the  people  a  step  had  not  the  unemployed 
spectre  ridden  them  with  spurs  deep  and  sharp.  New  Zea- 
land was  moving  at  her  ease  toward  the  adoption  of  the 
English  factory  legislation  before  the  popular  uprising  of 
1890,  but  after  that  event  the  country  moved  with  revolu- 
tionary rapidity,  and,  though  it  was  monopoly  of  land  and 
money  and  government  that  stimulated  the  uprising,  the 


246        A   COUNTRY   WITHOUT    STRIKES 

remedial  measures  dealing  with  the  labour  question  were 
quite  as  sweeping  as  any  of  the  others.  When  one  recalls 
that  the  labour  measures  included  compulsory  arbitration, 
compulsory  half-holidays  for  shops  and  factories,  a  com- 
pulsory educational  requirement  for  factory  children,  the 
extensive  abolition  of  the  contractor  in  public  works,  an 
instalment  of  the  minimum  wage,  the  institution  of  a  thor- 
ough and  successful  scheme  for  putting  the  unemployed 
on  public  works  and  at  the  same  time  making  them  settlers 
on  the  land,  it  will  be  admitted  that  the  labour  question 
received  an  extraordinary  amount  of  attention  from  those 
who  could  not  be  called  an  industrial  people  in  the  usual 
sense. 

In  the  years  just  before  1890  swarms  of  stalwart  men, 
many  of  them  skilled  workmen,  flooded  the  streets  of  the 
towns.  Soup  kitchens,  relief  works  at  degrading  wages, 
two-and-sixpence  a  day,  charity,  all  the  agencies  of  demor- 
alisation were  doing  their  bitter  work.  One  of  the  first 
things  done  by  the  new  party  of  liberalism  in  1891,  elected 
by  the  help  largely  of  the  votes  of  the  workingmen,  was 
to  establish  a  Labour  Department.  This  was  an  acknowl- 
edgment that  the  interests  of  the  workingmen  were  as  much 
a  political  matter  as  those  of  the  farmers  or  miners.  This 
democracy  believed  that  the  application  of  all  the  available 
energy  of  the  community  to  the  supply  of  all  the  needs 
of  the  community  was  a  concern  of  the  whole  people  if  any- 
thing was.  They  saw  that  the  government  of  the  people 
was  the  only  agency  that  had  the  power  or  the  machinery 
or  the  motive  to  serve  the  whole  people  in  the  common 
interest,  and  the  only  one  that  had  the  means  to  use  in 
any  comprehensive  way  the  information  that  could  be 
gained  by  a  labour  department. 

The  new  democratic  fervour  which  was  born  in  New  Zea- 
land of  the  oppression  of  the  people  by  the  land  and  money 


FOR  LABOUR   NOT  LITERATURE         247 

and  other  monopolies  gave  these  principles  immediate  effect. 
Though  the  population  was  largely  agricultural  the  new 
Department  of  Labour  was  made  equal  in  rank  to  that  of 
the  Department  of  Agriculture,  and  the  first  minister  was 
one  of  the  most  brilliant  members  of  the  party,  the  Hon- 
ourable William  Pember  Reeves.  The  permanent  head  of 
the  department  is  Mr.  Edward  Tregear,  of  whom  the 
Honourable  R.  W.  Best,  Minister  of  Lands  for  Victoria, 
says,  in  his  recent  report  of  a  tour  in  New  Zealand,  "Mr. 
Tregear  has  made  a  life-long  study  of  labour  problems  and 
to  some  extent,  no  doubt,  was  chosen  because  of  his  well- 
known  sympathy  with  schemes  for  the  amelioration  of  the 
condition  of  workingmen."  One  of  Mr.  Tregear's  strong- 
est characteristics  is  this  sympathy  with  workingmen,  but 
stronger  than  this  is  the  common  sense  which  dictates  to 
him  that  under  no  circumstances  is  the  workingman  in  dis- 
tress to  be  "killed  with  kindness"  by  being  pauperised.  His 
motto  is,  "With  work,  everything;  without  work,  nothing." 
That  unflinching  courage,  which  is  possible  only  to  the  man 
whose  culture  is  so  broad  that  he  instinctively  despises 
everything  but  the  truth,  is  characteristic  of  Mr.  Tregear. 
His  utterances  in  his  reports  concerning  the  evils  of  the 
present  industrial  system  in  general  and  the  special  evils  of 
New  Zealand  in  particular  are  of  a  frankness  usually  con- 
spicuous by  its  absence  in  official  labour  literature.  Thus 
he  says  in  his  report  for  1894:  "Hold  what  theory  we  may, 
hide  the  facts  in  what  casuistry  we  may,  it  remains  that 
the  wage-payer  is  the  master  of  the  wage-earner,  the  land 
holder  is  the  master  of  the  landless,  and  the  owner  of  ma- 
chinery is  the  master  of  the  machinist." 

It  appears  to  be  a  popular  idea  with  the  officials  of  labour 
departments  in  some  parts  of  the  world  that  the  purpose  of 
such  establishments  is  simply  to  provide  a  sort  of  university 
extension  fellowship  for  academic  students  of  sociological 


248         A  COUNTRY  WITHOUT   STRIKES 

questions  for  the  production  of  "scientific"  reports  to  be  em- 
bodied in  formidable  public  documents  distributed  through 
the  libraries  of  the  world  and  never  read.  But  the  New  Zea- 
land Labour  Department  is  for  labour  men,  not  for  labour 
literature.  This  Labour  Department  is  one  which  makes 
labour  its  care.  Its  first  duty  is  to  get  work  for  workless 
citizens,  and  it  puts  far  behind  these  in  importance  the  pub- 
lication of  statistics  and  more,  or  less,  learned  conclusions 
from  them.  If  a  family  wants  a  cook  or  a  farmer  a  harvest 
hand  the  nation  in  New  Zealand  does  not  think  it  too  small 
a  matter  to  stand  at  hundreds  of  places  in  towns  and  at 
cross-roads  with  pen  and  paper  to  catch  the  names  of  those 
who  might  meet  the  need,  and  for  this  it  makes  no  charge. 
If  a  country  girl  wants  housework  or  a  place  in  a  factory, 
or  a  workingman  getting  no  call  where  he  is  standing  in 
the  market-place  would  try  his  luck  in  another  town,  they 
find  that  the  nation  has  anticipated  them  and  is  waiting  for 
them  in  the  Registry  offices  with  a  list  of  every  one  in  the 
country  who  has  made  known  that  he  is  looking  for  such 
help  as  theirs.  This  democracy,  in  selecting  the  men  who 
are  to  have  the  chance  to  work,  gives  the  preference  to  the 
married  and  the  elderly  men.  It  can  take  into  account  the 
greatest  public  interest — not  the  interest  of  the  employer, 
who  looks  only  to  get  the  most  stalwart  men  for  his  money, 
but  the  interest  of  the  whole  community,  in  which  the  family 
is  the  greatest  value-producer.  Short-sighted  profit-seek- 
ing secures  a  momentary  advantage  in  the  strength  of  the 
young  and  single  men,  by  pauperising  married  men  and 
destroying  the  future  source  of  supply  of  young  single  men. 
It  gets  nuts  for  one  year  by  cutting  down  the  tree  which 
might  go  on  bearing  nuts  for  generations. 

From  first  to  last  the  department,  under  Mr.  Tregear, 
has  regarded  as  its  first  and  chief  duty — "its  vital  duty," 
he  calls  it — the  practical  task  of  finding  where  labour  was 


WITHOUT   WORK,   NOTHING  249 

wanted  and  depositing  there  the  labour  running  elsewhere 
to  waste.  In  the  last  year  2115  men  obtained  work  or 
received  temporary  advances  of  passages,  etc.,  to  enable 
them  to  reach  employment.  Of  these  937  were  single  and 
1117  were  married  men,  the  latter  having  4759  persons 
dependent  upon  them.  The  woman's  branch  of  the  depart- 
ment at  Wellington  has  also  found  employment  for  426 
women  and  girls  during  the  year.  From  June  i,  1891,  to 
March,  1899,  the  Labour  Department  has  found  work  for 
21,607  men>  upon  whom  52,246  persons  were  dependent. 
This  is  an  average  yearly  of  nearly  one  per  cent,  of  the 
population. 

Of  the  effect  of  this  upon  the  workers  Mr.  Tregear  says, 
in  his  report  for  1898,  "The  help  of  the  government  has 
been  of  immense  advantage.  It  has  often  meant  rescue,  if 
not  from  starvation,  from  the  reception  of  charitable  aid,  the 
acceptance  of  which  is  generally  unspeakably  bitter  to  hon- 
est working  people.  It  has  sometimes  prevented  a  feeling 
of  utter  despair  taking  possession  of  a  defeated  labourer 
and  has  enabled  him  not  only  to  get  a  few  weeks  or  a  few 
months  work  at  a  critical  time,  but  in  many  cases  has  al- 
lowed him  the  means  to  leave  an  over-crowded  town  and 
proceed  to  a  district  where  one  job  would  succeed  another 
until  he  has  found  a  place  in  rural  society  that  he  can  fill 
with  advantage  both  to  himself  and  to  his  neighbour." 

The  means  employed  by  Mr.  Tregear  are  the  maintenance 
of  a  widely  extended  system  of  agencies  for  bringing  work- 
ers and  work  together,  a  strict  decentralisation  of  the  unem- 
ployed by  scattering  them  through  the  colony,  and  a  refusal 
to  give  anything.  Aid  is  furnished  only  by  sending  the 
worker  to  private  employment  or,  if  to  public  works,  only  to 
such  as  were  necessary  and  reproductive.  This  is  in  clear 
contrast  with  methods  used  in  neighbouring  colonies,  as  in 
New  South  Wales.  There,  as  shown  by  official  investiga- 


250        A   COUNTRY   WITHOUT   STRIKES 

tions  both'  by  New  South  Wales  itself  and  by  government 
agents  from  New  Zealand,  the  unemployed  were  invited  to 
the  cities  by  gratuitous  food  and  shelter.  They  were  put 
to  work  at  things  obviously  useless  and  at  make-believe 
wages,  and  thereby  degraded.  The  unemployed  in  many 
cases  were  shipped  into  districts  where  disputes  were  pend- 
ing between  employers  and  employes,  with  the  result 
that  this  state  agency,  established  and  supported  by  the 
taxpayers  to  improve  the  condition  of  the  working  people, 
was  used  to  depress  the  level  of  wages  and  living  of  all 
the  people.  In  New  Zealand,  to  carry  on  its  work  of  shift- 
ing labour  from  the  congested  districts  to  those  where  la- 
bour was  in  demand,  the  Labour  Department  created  two 
hundred  agencies,  covering  the  whole  country.  In  the 
towns  various  officials,  like  factory  inspectors,  undertook 
the  duty,  and  in  the  country  districts  the  constables  acted. 
In  only  a  few  large  towns  were  special  agents  appointed. 

If  the  transfer  of  workers  to  work  had  been  left  wholly 
to  the  efforts  of  the  Labour  Department  no  great  results 
could  have  been  expected;  but,  as  has  already  been  shown, 
New  Zealand,  through  other  departments,  has  entered  upon 
a  wide  and  intelligent  and  successful  system  of  making 
work  for  the  unemployed.  When  the  Labour  Department 
has  gathered  its  unemployed  it  finds  both  the  Land  Depart- 
ment waiting  with  its  roads  and  the  Public  Works  Depart- 
ment waiting  with  its  court  houses,  post-offices,  railroads, 
bridges,  etc.,  ready  to  take  the  men  off  its  hands  if  private 
employment  cannot  be  found  for  them. 

Two  features  have  characterised  this  policy  from  the  be- 
ginning :  the  men  were  given  nothing  but  a  chance,  and  no 
work  was  made  for  the  sake  of  making  work.  Nothing 
was  undertaken  that  was  not  necessary  and  that  would  not 
be  profitable  to  the  community.  There  was  no  setting  of 
men  to  shovel  sand  from  one  point  only  to  shovel  it  back 


A  GOLDEN  STREAM  RUNNING  AWAY    251 

again,  as  was  done  in  the  parks  of  Sydney,  and  from  the 
beginning  there  was  never  the  least  touch  of  charity.  The 
man  had  to  pay  ultimately  for  everything — for  the  railroad 
ticket  taking  him  and  his  family  to  their  new  home,  for 
the  food  and  shelter  they  had  on  the  way,  for  the  tools  he 
found  ready  for  him,  for  the  tents,  for  everything. 

Another  feature  of  Mr.  Tregear's  administration  of  the 
Labour  Department  has  been  that  he  has  conceived  it  to 
be  his  function  not  to  provide  work  for  manual  workers 
alone,  but,  in  his  own  phrase,  for  "all  classes  of  labour, 
mental  as  well  as  physical." 

It  is  true,  notwithstanding  all  that  has  been  done  by  the 
Labour  Bureau,  the  Land  Department,  the  Department  of 
Public  Works  and  the  railroads  in  finding  work  for  the 
workless,  that  there  are  still  unemployed  in  New  Zealand, 
and  still  the  distress  that  comes  from  forced  idleness.  Even 
in  good  times  like  these  we  find  such  items  in  the  New  Zea- 
land papers  as  this,  in  June  last:  "Since  the  beginning  of 
the  cold  weather  nearly  two  hundred  persons  have  been 
supplied  with  coal  and  blankets  in  Christchurch,  and  a  large 
number  of  others  are  on  the  books" ;  and  in  May,  "We  learn 
that  fifty  unemployed  waited  on  the  mayor  to  ascertain 
whether  the  city  council  intended  to  put  any  works  in  hand 
to  absorb  the  surplus  labour."  Evidently  the  New  Zealand 
methods  do  not  fully  meet  the  great  modern  problem  of  how 
to  save  the  golden  stream  of  human  energy  that  is  running 
away  between  our  fingers  every  day,  as  the  seconds  tick 
off  the  unused  days  of  millions  of  men  made  idle — a  prob- 
lem not  of  poverty  but  of  wealth,  of  wealth  which  has  set 
labour  free  by  new  machinery,  new  methods,  new  combina- 
tions, and  has  not  yet  found  the  new  "place  where"  for  la- 
bour's disengaged  lever,  a  problem  of  wealth  producing 
poverty  that  waits  to  be  made  wealth  again.  All  that  New 
Zealand  can  claim  and  does  claim  is  that  it  has  done  more 


252         A   COUNTRY   WITHOUT   STRIKES 

than  others,  and  that  its  efforts  are  in  the  right  direction. 
But  manifestly  they  are  only  a  beginning. 

There  is  no  eight-hours  day  for  men  in  New  Zealand  by 
law,  but  the  hours  of  women  and  children  are  restricted,  and 
this  operates  as  a  hardship  in  many  cases.  The  Chinese  in 
their  laundries  are  subject  to  no  limitation  as  to  hours, 
being  men,  while  the  white  laundry  women  who  work  in 
competition  with  them  are  compelled  to  stop  at  certain 
hours.  This  makes  heavier  the  burden  of  the  women,  al- 
ready too  poorly  paid  and  too  hard  worked.  It  is  being 
urged  that  this  discrimination  between  men  and  women  be 
ended.  When  women  had  no  political  rights  and  powers  it 
was  natural  enough  that  they  should  be  given  especial  pro- 
tection by  law,  but  now  that  they  have  the  ballot  they  stand 
on  equal  terms  with  men  before  the  law-makers,  and  their 
special  immunities  should  cease.  In  the  factories  again,  as 
well  as  in  the  laundries,  the  requirement  that  the  women 
stop  work  at  a  given  moment,  while  the  men  can  continue, 
puts  the  women  at  a  disadvantage.  It  is  characteristic  of 
the  New  Zealander  that  the  plan  most  favoured  for  equal- 
ising the  men  and  women  is  not  to  take  away  from  the 
women  the  protection  of  a  legal  prohibition  of  too  long 
hours,  but  to  give  it  to  men,  who,  for  the  sake  of  health 
and  the  public  good,  require  a  fair  share  of  leisure  quite 
as  much  as  the  women. 

There  is  a  venerable — and  fruitless — agitation  in  England 
for  a  weekly  half-holiday.  Men  like  Lubbock  and  the  Duke 
of  Argyle  have  prevented  the  application  of  the  only  method 
by  which  such  a  measure  can  be  made  effective.  The  fetish 
of  self-help  has  blocked  every  attempt  to  make  this  move- 
ment successful.  It  could  be  made  successful  only  by  being 
made  universal — all  shops,  all  factories  must  observe  it,  or 
none  would.  This  universality  can  be  had  only  by  polit- 
ical action,  and  this  means  a  law,  and  law  means  compul- 


NEITHER   HEAD   NOR   HEART  253 

sion.  This  boon  for  the  clerks  of  the  retail  stores  was  one 
of  the  first  labour  measures  proposed  and  carried  in  New 
Zealand,  and  it  was  made  effective  there  by  compulsion. 
"Compulsion,"  an  eminent  New  Zealander  said  in  defend- 
ing this  policy,  "means  only  that  the  duty  is  binding  on  all, 
and  that  the  interests  of  all  require  it.  If,  under,  such  cir- 
cumstances, it  is  wrong  to  compel,  our  whole  civilisation  is 
wrong,  for  its  fundamental  method  is  that  when  the  inter- 
ests of  all  have  been  clearly  defined  the  minority  must  sub- 
mit. There  is  always  an  intractable  or  criminal  minority  in 
every  company.  To  withhold  compulsion  in  matters  affect- 
ing the  interests  of  all  is  to  submit  the  interests  of  all  to 
the  rule  of  a  few.  The  ideal  is  that  all  shall  unite  and  do 
the  right;  the  actual  is  that  there  are  always  degenerates, 
criminals,  cranks,  or  belated  ones  who  cannot  yet  do  the 
right.  We  have  to  choose  between  compulsion  of  the  many 
by  the  few  or  the  reverse.  Compulsion  is  a  choice  of  evils, 
but  it  is  here  the  right  choice." 

Just  as  the  people  of  New  Zealand  made  binding  upon  all 
the  duty  of  arbitration  and  thus  secured  industrial  peace, 
they  have  made  binding  upon  all  engaged  in  retail  trade 
the  half-holiday.  They  do  not  require  merely  that  the  em- 
ployes must  be  given  the  holiday,  the  employers  must  take 
it,  too.  The  shop  must  be  closed.  The  law  has  neglected 
to  safeguard  this  concession  to  the  shop  clerks  by  stipulating 
that  they  shall  not  be  worked  longer  hours  on  the  other  days 
to  make  up  for  the  time  they  get  by  the  holiday,  and  the  re- 
sult is  that  in  many  cases,  though  the  people  have  the  half- 
holiday,  they  work  as  long  as  before  and  sometimes  longer. 
It  is  proposed  to  remedy  this  by  limiting  the  hours  during 
which  shops  can  be  kept  open,  and  this,  like  the  half-holiday, 
will  be  got  compulsorily.  "It  seems  idle,"  Secretary  Tre- 
gear  says,  "to  ask  the  public  to  refrain  from  purchasing 
after  a  certain  hour.  In  such  matters  the  public  has  neither 


254        A   COUNTRY   WITHOUT   STRIKES 

head  nor  heart.  It  is  when  that  right  is  established  by 
statute  that  it  obtains  recognition  from  people  too  much  ab- 
sorbed in  their  own  business  to  recognise  that  they  are 
causing  injury  to  others." 

Merchants  and  banks  must  close  their  offices  at  five 
o'clock  in  the  afternoon  during  two  thirds  of  each  month. 
The  extension  of  this  protective  legislation  to  the  "upper 
class"  of  the  labour  world  is  a  New  Zealand  novelty,  and 
there  is  a  strong  demand  that  the  benefits  of  the  compulsory 
arbitration  act  be  also  given  the  same  classes.  When  the 
half-holiday  was  first  established  the  opposition  was  very 
angry.  The  measure' was  denounced  by  the  merchants  as 
an  outrageous  "interference  with  the  liberty  of  the  subject," 
but  now  the  employers  like  the  holiday  as  much  as  the  clerks, 
and  any  proposal  to  return  to  the  old  order  would  be  re- 
sisted by  the  one  as  much  as  by  the  other. 

Shops  in  New  Zealand  are  under  inspection  like  factories. 
Women  and  children  are  not  allowed  to  work  more  than 
fifty-two  hours  a  week  in  shops,  and  not  more  than  forty- 
eight  in  factories.  There  must  be  seats  for  the  girls,  and 
their  right  to  use  them  is  zealously  protected.  The  Mar- 
quis of  Salisbury,  Premier  of  England,  took  pains  to  rise  in 
his  seat  in  the  House  of  Lords  and  speak  to  prevent  such  a 
boon  being  given  to  the  girls  in  the  English  shops.  The  Pre- 
mier of  New  Zealand  helped  this  reform  through  his  Parlia- 
ment. There  is  a  half-holiday  for  factories  as  well  as  shops. 
Factories  must  be  closed  after  i  P.M.  on  Saturday  without 
deduction  of  pay  for  time-workers.  Mothers  are  not  al- 
lowed to  work  for  a  month  after  the  birth  of  a  child.  Over- 
time is  prohibited,  except  on  permission  of  the  inspectors, 
and  with  that  it  is  allowed  for  only  twenty-eight  days  in  the 
year.  No  child  under  sixteen  is  allowed  to  work  unless 
found  physically  fit  by  an  inspector,  and  no  child  under 
fourteen  is  allowed  in  a  factory  at  all.  There  are  no  half- 


LAWS   THAT   ARE   NOT    NULLITIES      255 

timers.  The  regulation  of  the  amount  of  air,  space  and 
sanitary  conditions  is  under  the  absolute  power  of  the  in- 
spectors, who  can  insist  upon  their  being  made  such  as  they 
consider  necessary  for  the  life  and  health  of  the  working 
people.  All  the  factories  are  under  these  regulations,  and 
the  word  "factory"  is  so  closely  defined  that  no  one  can 
escape.  A  factory  in  New  Zealand  is  any  place  where  two 
or  more  people  are  occupied  in  industry.  A  man  and  one 
helper  are  a  factory,  although  the  helper  be  a  member  of 
his  own  family.  Even  hawkers  are  regulated  by  being  de- 
fined by  law  as  "a  shop." 

These  laws  are  not  nullities.  In  Auckland  one  employer 
was  fined  sixty-six  shillings,  $16.50,  on  five  charges  of 
employing  an  assistant  after  one  o'clock  on  Saturday.  An- 
other employer  was  fined  $8.50  for  failing  to  provide  proper 
seats  for  his  girls,  and  another,  for  causing  an  assistant 
under  eighteen  years  of  age  to  work  more  than  nine  and 
one  half  hours  in  one  day,  had  to  pay  $9.  A  baker  who 
had  worked  his  girls  all  night  was  fined  one  pound,  $5,  for 
each  case,  and  warned  that  he  had  made  himself  liable  to 
a  fine  of  $50  on  each  charge.  The  judge  seemed  to  show 
a  dyspeptic  desire  to  increase  the  fine  when  the  poor  man 
pleaded  that  he  had  been  engaged  in  baking  hot-cross  buns 
for  Good  Friday,  and  his  further  plea  that  some  of  the 
girls  were  members  of  his  owm  family  did  not  save  him. 
A  restaurant  keeper,  having  kept  two  of  his  girls  at  work 
for  more  than  eleven  and  one  half  hours,  was  fined  $36.50, 
although  one  of  the  girls  had  had  three  afternoons  off  the 
same  week.  Another  baker,  for  neglecting  to  allow  one  of 
his  girls  a  full  hour  for  dinner,  was  fined  two  pounds  there- 
for, and  had  to  pay  $7.50  costs  in  addition. 

This  strictness  of  the  enforcement  of  the  factory  laws  is 
proof  enough  of  the  honesty  of  the  officials,  but  there  is 
the  same  kind  of  human  nature  in  New  Zealand  as  seeks 


256        A   COUNTRY   WITHOUT   STRIKES 

elsewhere  for  its  own  selfish  ends  to  make  breaches  in  such 
safeguards  of  the  welfare  of  others.  A  man  prominent  in 
the  Labour  Department  told  me  that  at  the  beginning  of 
his  career  as  inspector  he  had  the  greatest  difficulty  in  mak- 
ing the  manufacturers  believe  that  they  could  not  blind  the 
administration  of  the  law  by  putting  guinea  scales  on  the 
eyes  of  the  inspectors.  He  was  constantly  "approached" 
in  this  way.  If  he  visited  a  factory  one  day  a  bale  of  its 
shawls  or  whatever  its  stuffs  were  would  come  to  his  house 
the  next  morning. 

The  principle  of  the  minimum  wage  is  accepted  in  New 
Zealand  as  well  as  in  Victoria.  In  New  Zealand  minimum 
wages  are  being  constantly  determined  by  the  decisions  of 
the  arbitration  court,  but  there  is  also  a  minimum  wage 
established  by  law.  The  factory  act  stipulates  that  the  pay 
for  overtime  must  not  be  less  than  sixpence  an  hour  extra. 
Another  minimum  wage  enactment  was  made  by  the  last  ses- 
sion of  the  New  Zealand  Parliament.  One  of  the  industrial 
evils  there  has  been  the  employment  of  a  large  number  of 
young  men  and  women  without  pay  under  the  pretence  that 
they  were  sufficiently  remunerated  by  being  taught  a  trade. 
To  put  an  end  to  this  abuse  the  "Employment  of  Boys  and 
Girls  without  Payment  Prevention  Act"  was  passed.  This 
enacts  that  in  all  cases  of  the  employment  of  young  people 
under  eighteen  years  of  age  there  must  be  paid  not  less 
than  four  shillings,  one  dollar,  a  week  for  girls  and  five 
shillings  for  boys,  irrespective  of  overtime.  This  legisla- 
tion was  not,  so  far  as  I  could  learn,  especially  promoted  by 
the  working  people,  as,  indeed,  very  little  of  the  labour 
legislation  has  been.  I  must  confess  I  was  much  interested 
to  be  told  by  one  of  the  men  most  active  in  securing  its 
passage  that  it  was  hoped  that  one  effect  of  it  would  be  that 
the  girls,  who  would  certainly  be  thrown  out  of  factory 
life  by  the  requirement  that  they  be  paid,  would  betake 


CONSERVATIVE   PROPHECIES  257 

themselves  to  domestic  service,  to  the  relief  of  the  New  Zea- 
land housekeeper,  who  has  the  same  domestic  help  problem 
that  her  sister  the  world  over  has,  and  to  the  moral  and 
physical  elevation  of  the  girls  themselves. 

New  Zealand  supplements  its  system  of  free  and  universal 
primary  education  by  refusing  to  allow  uneducated  children 
to  be  employed  in  its  factories.  Any  child  under  fifteen 
years  of  age  must  be  able  to  show  a  certificate  of  the  fourth 
grade  before  it  can  be  taken  into  employment  in  a  factory. 

Workingmen  in  New  Zealand  have  been  bitterly  complain- 
ing for  years  of  the  exactions  to  which  they  were  subjected 
under  the  pretence  of  accident  insurance.  Constant  deduc- 
tions were  made  from  their  wages  by  employers  for  such 
insurance.  The  employer  might  pay  the  money  to  the  in- 
surance company  or  he  might  put  it  into  his  own  pocket. 
The  workingman  would  suffer  this  deduction  one  week, 
and  the  very  next  week,  losing  his  place,  would  find  him- 
self uninsured,  and  if  he  took  another  place  be  subjected 
to  another  deduction.  It  was  claimed  that  the  consent  of 
the  workingmen  was  obtained,  but,  as  Secretary  Tregear 
said  in  answer,  "Under  the  pressure  of  modern  competition 
in  industrial  life  'consent'  is  a  word  of  pregnant  signifi- 
cance." In  the  last  session  of  Parliament  this  extortion 
was  stopped  by  adding  accident  insurance  to  the  business 
of  the  Life  Insurance  Department  and  by  the  "Wages  Pro- 
tection Act,"  forbidding  all  employers  from  making  any 
deductions  whatever  from  the  wages  of  their  employes  for 
accident  insurance  and  forbidding  the  insurance  companies 
to  receive  from  any  workingman  money  for  insurance  of 
which  the  employer  was  to  get  the  benefit. 

When  the  factory  acts  and  other  labour  measures  were 
first  introduced  they  were  received  by  the  Conservatives 
with  the  greatest  indignation  and  alarm.  Eminent  mem- 
bers of  that  party  predicted  in  Parliament  that  they  would 


258         A   COUNTRY   WITHOUT    STRIKES 

prove  "a  delusion,  a  shame  and  a  snare,"  and  that  they 
would  create  revolutionary  dissatisfaction  among  the  people 
whose  liberty  they  so  much  curtailed.  Of  all  the  blue  ruin 
thus  predicted  in  1891  the  only  realisation  has  been  the  ruin 
which  finally,  in  the  election  of  1899,  overtook  the  authors 
of  these  prophecies,  the  Conservative  Party,  which  then,  a 
shattered  and  hopeless  wreck,  disappeared  forever  beneath 
the  waters  of  New  Zealand  politics. 

Nothing  can  be  more  striking  than  the  contrast  theoretical 
and  practical  between  the  Victorian  minimum  wage  system 
and  the  New  Zealand  compulsory  arbitration  law.  The 
latter  is  a  thorough-going  scheme,  built  up  solidly  on  a 
statesman-like  basis,  to  deal  not  only  with  a  few  cases  but 
with  the  whole  problem  of  the  civil  war  between  capital  and 
labour.  Though  the  cure  of  the  sweating  system  was  not 
one  of  its  avowed  purposes,  the  New  Zealand  compulsory 
arbitration  law  alleviates  it  with  a  far  greater  thoroughness 
than  the  "special  boards"  of  Victoria.  New  Zealand,  the 
only  country  which  has  a  compulsory  arbitration  law,  is  the 
only  country  in  which  for  five  years,  with  one  or  two  in- 
significant exceptions,  there  has  been  no  strike  or  lockout 
in  the  world  of  organised  labour.  The  New  Zealand  ex- 
periment answers  every  test  which  can  be  applied  to  prove 
the  claim  of  a  new  institution  to  be  a  permanent  and  verit- 
able addition  to  the  world's  social  inventions.  Practically 
it  does  what  it  undertook  to  do — it  ushers  in  industrial 
peace.  Philosophically  it  is  an  extension  to  a  new  field — 
that  of  industrial  anarchy — of  an  old  institution — that  of 
the  law — by  which  social  peace  has  been  created  in  the  other 
territories  of  disorder.  Every  day  since  its  introduction  the 
law  has  struck  its  roots  deeper  into  the  life  of  the  New  Zea- 
land people,  and  it  further  approves  itself  by  producing  not 
only  what  was  expected  of  it  but  many  new  and  almost 
equally  important  fruits,  such  as  checking  cut-throat  com- 


The  Hon.  William  Pember  Reeves,  Author  of 
the  Compulsory  Arbitration  Law. 


(Page  259.) 


A   POLITICAL   GENIUS  259 

petition  between  business  men  and  putting  an  end  to  trade 
dishonesty.  Another  feature  of  the  New  Zealand  law  which 
commends  itself  to  the  philosophical  student  of  institutions 
is  that  its  appearance  came  in  the  direct  line  of  evolutionary 
development.  Other  communities,  notably  Massachusetts, 
had  carried  arbitration  up  to  the  Rubicon  of  compulsion. 
New  Zealand  took  the  next  step. 

The  law  is  entirely  without  precedent — nowhere  in  the 
world  except  in  New  Zealand  is  there  any  compulsory  ar- 
bitration— and  it  has  been  so  successful  that  it  may  fairly 
be  questioned  whether  it  has  not  established  a  precedent 
that  no  other  modern  people  largely  committed  to  industrial 
life  can  afford  to  disregard.  The  compulsory  arbitration 
law  did  not  spring  out  of  theory,  and  has  not  ended  in  the- 
ory. It  was  the  remedy  sought  as  a  way  of  escape  from 
practical  embarrassments  of  the  most  serious  sort.  The 
strike  of  1890  brought  New  Zealand  as  well  as  Australia 
within  a  day's  journey  of  anarchy.  This  was  followed  by 
apprehensions  of  a  big  railroad  strike.  To  save  New  Zea- 
land from  being  ravaged  by  these  industrial  conflicts,  more 
terrible  in  their  sum-total  of  losses  than  a  foreign  war,  the 
then  Minister  of  Labour,  the  Honourable  William  Pember 
Reeves,  who  lately  came  to  America  as  the  official  repre- 
sentative of  his  government  at  the  Commercial  Congress 
in  Philadelphia,  began  to  study  what  had  been  accomplished 
by  other  nations  in  arbitration. 

Mr.  Reeves  was  a  young  man;  his  career  had  been  that 
of  a  lawyer,  journalist,  poet,  politician.  His  compulsory 
arbitration  law  is  the  first  piece  of  legislative  work  which 
came  from  him  to  attract  attention  outside  New  Zealand, 
but  I  am  distinctly  of  the  opinion  that  that  will,  in  the  judg- 
ment of  coming  years,  entitle  him  to  a  place  in  the  first  rank 
of  political  inventors. 

Mr.  Reeves  studied  all  that  had  been  done  by  other  coun- 


260        A   COUNTRY   WITHOUT    STRIKES 

tries,  and  was  forced  to  the  conclusion  that  "voluntary  arbi- 
tration is  a  sham."  He  traced  the  development  of  arbi- 
tration in  all  the  leading  countries  up  to  the  Massachusetts 
Board  of  Conciliation  and  Arbitration.  This  he  found  the 
best  of  all  and  lacking  only  one  thing  to  make  it  completely 
successful — compulsion.  New  Zealand  began  where  Mass- 
achusetts left  off,  and  has  succeeded  where  Massachusetts 
failed.  Mr.  Reeves  saw  that  to  be  effective  arbitration,  like 
taxation,  must  be  compulsory,  not  that  the  minority  might 
rule  the  majority,  but  that  it  might  not.  Time  and  time 
again  in  New  Zealand  the  majority  of  masters  and  men 
in  a  trade  had  agreed  to  terms  of  settlement  or  methods 
of  arbitration,  sometimes  after  years  of  negotiation,  only 
to  have  the  whole  structure  of  their  civilised  effort  over- 
thrown by  an  irreconcilable  minority  of  commercial  cut- 
throats determined  not  to  abate  one  jot  or  tittle  of  their 
privilege  of  murderous  competition. 

The  theory  of  the  compulsory  arbitration  law  is  that  the 
majority  must  rule.  There  are  three  parties  vitally  inter- 
ested in  every  industrial  dispute:  labour,  capital  and  the 
state.  Whichever  side  the  state  finds  right  is  therefore  in 
a  majority. 

The  New  Zealanders  are  not  at  all  sensitive  about  the  use 
of  compulsion.  They  are  the  most  democratic  people  in 
the  world,  and  they  believe  in  whatever  compulsion  is  neces- 
sary to  prevent  the  minority  from  ruling.  They  see  that 
compulsion  is  only  another  name  for  law.  Taxation  is  com- 
pulsory, sanitation  is  compulsory,  education  is  compulsory, 
and  good  order  is  compulsory.  The  compulsion  which  any 
citizen  can  avoid  by  behaving  himself  and  doing  the  right 
is  not  a  compulsion  which  need  worry  respectable  people. 

The  New  Zealanders  do  not  think  the  compulsion  of  the 
Court  of  Arbitration  as  odious  as  the  compulsion  of  riotous 
labourers  on  one  side  or  of  Catling  guns  and  Idaho  bull 


THEY   PREFER    COMPULSION  261 

pens  on  the  other.  The  existence  of  the  power  of  compul- 
sion makes  compulsion  often  unnecessary.  Some  of  the 
pleasantest  incidents  of  the  operation  of  the  new  system  have 
been  those  in  which  employers  and  employes  in  trouble  with 
each  other  have  appeared  before  the  judge  of  the  arbitration 
court  for  his  intervention  privately  and  by  means  of  it  have 
reached  a  harmonious  settlement  without  even  the  slight 
loss  of  time  and  money  in  a  proceeding  before  his  court. 

As  to  violations  of  the  law  there  have  been  some,  but 
the  court  has  found  no  difficulty  in  imposing  penalties  on 
the  guilty  men,  and  they  have  found  no  difficulty  in  sub- 
mitting to  them. 

How  shrewd  and  correct  was  Mr.  Reeves'  conclusion  that 
compulsion  was  the  missing  link  in  arbitration  is  shown 
by  the  fact,  seen  over  and  over  again  in  the  proceedings  in 
New  Zealand,  that  the  disputants  themselves  prefer  com- 
pulsion to  conciliation.  A  majority  of  the  cases,  instead 
of  resting  in  the  decisions  of  the  conciliation  boards,  go  on 
up  to  the  arbitration  courts,  though  these  in  almost  all  cases 
sustain  the  boards.  Both  sides  want  compulsion,  because 
they  know  that  is  final. 

Considering  that  there  was  no  law  to  guide  Mr.  Reeves 
and  no  experience  to  serve  as  precedent,  the  fact  that  he 
was  able  in  so  untrodden  a  field  to  contrive  a  measure  which 
should  go  into  successful  operation  must  be  considered  a 
legislative  feat  of  the  highest  order.  His  bill  for  compul- 
sory arbitration  was  debated  through  three  sessions  of  Par- 
liament, twice  thrown  out  by  the  upper  house,  and  finally, 
so  cogent  had  been  Mr.  Reeves'  treatment  of  the  matter,  was 
passed  almost  without  opposition.  It  was  enacted  in  1894, 
to  go  into  effect  in  1895.  The  first  case  arose  in  1896. 

The  principal  points  of  the  law  are,  first,  procedure  for 
voluntary  arbitration,  with  no  publicity  and  no  investiga- 
tion if  the  parties  can  thus  settle  their  difficulties  among 


262         A   COUNTRY   WITHOUT   STRIKES 

themselves ;  but  if  they  cannot,  the  law  shows  its  other  face. 
If  their  differences  are  irreconcilable  by  themselves  the 
parties  must  arbitrate  if  either  of  them  so  elects;  fight  they 
shall  not,  if  either  wants  arbitration.  The  compulsion  of 
the  law  is  threefold :  compulsory  publicity,  compulsory  ref- 
erence to  a  disinterested  party,  and  compulsory  obedience  to 
the  law's  awards.  The  state  has  no  powers  to  intervene 
in  any  dispute,  even  for  inquiry,  of  its  own  motion.  Those 
concerned  sue  and  are  sued  as  in  other  courts. 

The  law  was  originally  entitled  "An  Act  to  Encourage 
the  Formation  of  Industrial  Unions  and  Associations  and 
to  Facilitate  the  Settlement  of  Industrial  Disputes  by  Con- 
ciliation and  Arbitration,"  and  the  plan  of  arbitration  as 
conceived  by  Mr.  Reeves,  and  so  successfully  operated  in 
New  Zealand,  contemplates  the  organisation — voluntarily,  of 
course — of  both  employers  and  employes,  separately,  into 
associations  and  unions  as  the  foundation  of  the  whole 
structure.  It  is  believed  to  be  better  for  each  side  and  for  the 
public  that  the  parties  to  an  industrial  dispute  should  be 
committees  rather  than  mobs.  To  induce  capital  and  labour 
thus  to  organise,  special  privileges  are  granted  them,  the 
greatest  of  these  being  the  right  to  call  the  other  to  arbitra- 
tion. Only  workingmen  who  organise  and  register  under 
the  arbitration  law  are  subject  to  it.  Compulsory  arbitra- 
tion is  therefore  after  all  voluntary  arbitration,  so  far  as 
the  workingmen  at  least  are  concerned,  for  the  act  cannot 
be  invoked  by  or  against  any  workingmen  who  are  not 
organised  into  a  trades-union.  Employers  may  be  sued 
singly,  otherwise  the  act  could  be  defeated  by  the  refusal 
of  employers  to  form  themselves  into  associations.  There 
is  a  Board  of  Conciliation  in  each  of  six  districts  into  which 
New  Zealand  has  been  divided,  and  before  these  boards  in- 
dustrial disputes  are  first  tried.  If  a  settlement  is  not 
achieved  before  the  Conciliation  Board  the  case  goes  on 


THE   INDUSTRY   GOES   ON  263 

up  to  the  Court  of  Arbitration,  which  sits  for  the  whole 
colony. 

On  both  the  Board  of  Conciliation  and  the  Court  of 
Arbitration  employers  and  employes  are  represented  equally 
by  men  of  their  own  choice.  The  presiding  officer  of  the 
Court  of  Arbitration  is  a  judge  of  the  Supreme  Court  of 
the  colony.  This  procedure  guarantees  that  throughout  the 
entire  investigation  both  sides  shall  be  represented  by  men 
of  their  own  class,  familiar  with  all  the  circumstances  of 
their  calling.  Experts  can  be  called  in  to  represent  both 
sides  and  to  act  as  members  of  the  boards  or  the  court. 
Lawyers  are  not  allowed  to  appear  for  either  disputant  ex- 
cept by  the  consent  of  both  sides.  The  chairmen  of  the 
boards  must  be  "impartial  persons"  who  are  "willing  to 
act."  By  making  a  judge  of  the  Supreme  Court  President 
of  the  Court  of  Arbitration  the  colony  gives  a  guarantee 
to  the  disputants  that  the  casting  vote  and  the  conduct  of 
the  investigation  shall  be  in  the  hands  of  the  best  that  the 
colony  can  give  of  experience,  ability,  dignity  and  disin- 
terestedness. Every  precaution  is  taken  that  the  proceed- 
ings shall  be  cheap,  expeditious  and  untechnical.  The  trib- 
unals are  expressly  charged  to  make  their  decisions  in 
accordance  with  the  common  sense  and  equity  of  the  case, 
and  not  to  frame  their  awards  in  a  technical  manner.  Mean- 
while the  industry  goes  on.  Neither  employer  nor  employe 
is  allowed  to  stop  work  to  escape  the  conciliation  or  arbitra- 
tion proceedings,  nor  to  do  so  in  order  to  evade  an  award. 
The  law  even  reaches  back  of  the  time  at  which  its  inter- 
vention is  invoked.  At  any  time  within  six  weeks  after 
workingmen  have  struck  or  employers  have  locked  out,  the 
aggrieved  party  on  one  side  or  the  other  can  go  to  the  Ar- 
bitration Court,  begin  proceedings,  and  obtain  an  award. 
In  this  way  even  if  a  strike  or  lock-out  has  begun  the  court 
is  able  to  stop  it.  The  employer  cannot  get  out  of  a  dis- 


264        A   COUNTRY   WITHOUT   STRIKES 

pute  with  his  men  by  discharging  them  and  putting  on  new 
men.  The- men  laid  off  can  go  before  the  Arbitration  Court 
at  any  time  within  six  weeks  and  get  redress. 

In  South  Australia  employers  can  be  brought  in  only  if 
they  have  registered,  but  in  New  Zealand  the  employer  can- 
not, as  in  South  Australia,  keep  himself  out  of  the  reach  of 
arbitration  by  thus  omitting  to  register.  The  workmen  can 
call  him  before  the  court  on  their  own  motion. 

The  law  has  now  been  in  active  use  since  May,  1896. 
In  that  time  there  have  been  about  fifty  cases  before  it.  It 
was  believed  by  the  author  of  the  law  that  the  Court  of 
Arbitration  would  seldom  be  resorted  to,  and  that  the 
boards  of  conciliation  would  settle  most  of  the  disputes, 
but  it  has  worked  out  quite  otherwise.  Two  thirds  of  the 
cases  have  gone  from  the  boards  of  conciliation  up  to  the 
Court  of  Arbitration,  but  most  of  the  decisions  of  the  con- 
ciliation boards  have  been  sustained  by  the  court. 

The  Arbitration  Court  has  shown  moderation  and  good 
sense  in  using  its  delicate  powers,  and  the  judges  have  done 
as  little  "legislating"  as  possible,  either  as  regards  the  logic 
or  the  arithmetic  of  business.  But  in  their  decisions  there 
can  clearly  be  seen  emerging  some  new  principles  of  eco- 
nomic relation.  The  court,  for  instance,  insists,  wherever 
possible,  that  trades-unionists  be  given  employment  before 
non-unionists  are  put  to  work.  This  for  the  reason  of  pub- 
lic policy  that  all  interests  are  promoted  by  the  organisa- 
tion of  labour,  and  because  the  trades-unions  by  their  efforts 
and  sacrifices  improve  conditions  and  rates  of  wages,  and 
are  fairly  entitled  to  the  first  consideration.  The  court  has 
also  directed  that  when  work  grows  slack  it  shall  not  be 
given  to  a  few,  but  shall  be  divided  among  all  the  men, 
thus  keeping  all  employed.  It  has  also  ordered  that  a  pref- 
erence should  be  given  to  residents,  and  that  they  should  be 
given  work  before  outsiders  are  employed. 


PREFERENCE   BOTH   WAYS  265 

The  ordinary  employers  of  New  Zealand,  like  employers 
everywhere,  are  bitterly  opposed  to  trades-unions.  These 
help  the  workers  to  get  better  prices  for  the  labour  which  the 
employers  prosper  by  buying  cheap,  and  this  preference 
shown  to  trades-unionists  has  been  a  sore  point  with  them 
ever  since  the  principle  was  adopted  by  the  Court  of  Arbi- 
tration. In  1900  the  Employers'  Association  of  Canterbury 
obtained  an  injunction  from  the  Supreme  Court  forbidding 
the  Arbitration  Court  to  give  trades-unionists  preference  of 
employment.  This  was  at  once  met  by  the  Canterbury 
Trades  Council  by  a  counter  application  to  the  court  for  an 
order  to  set  aside  the  injunction.  This  application  was  suc- 
cessful, and  the  Arbitration  Court  is  now  fully  and  finally 
established  in  its  right  to  give  this  preference  whenever  it 
seems  called  for  by  the  circumstances  of  the  case. 

Another  reason  for  giving  preference  to  trades-union- 
ists is  that  it  was  a  proper  compensation  to  them  for  the 
deprivation  by  the  arbitration  law  of  their  power  to  strike. 
Under  the  old  system  they  could  enforce  their  demands  by 
striking,  and  since  the  public,  on  account  of  the  great  dam- 
age to  public  interests,  forbade  these  trades-unions  to  use 
this  weapon  they  are  given  in  lieu  of  it  the  first  chance  of 
employment. 

"Preference"  must  work  both  ways.  The  Arbitration 
Court,  in  giving  organised  labour  preference  of  employment, 
calls  on  them  in  return  to  give  a  preference  in  the  supply  of 
labour  to  employers  who  are  organised  under  the  law.  An- 
other requirement  made  of  the  trades-unions,  in  consideration 
of  the  preference  of  employment,  is  that  they  must  not  be 
monopolies,  but  must  admit  all  competent  men  to  the  union. 

The  court  has  also  taken  pains  to  prescribe,  even  in  cases 
where  it  gave  preference  of  employment  to  the  members  of 
unions,  that  non-unionists  who  were  at  work  should  not  be 
discharged.  It  has  also,  where  members  of  unions  have 


266        A   COUNTRY    WITHOUT   STRIKES 

been  discharged  obviously  to  intimidate  or  destroy  the 
union,  ordered  that  they  should  be  reinstated  and  has 
awarded  heavy  damages  to  their  union. 

The  court  in  its  awards  fixes  an  average  or  "minimum 
wage"  as  the  rate  necessary  to  be  paid  the  ordinary  worker, 
but  it  provides  very  carefully  for  the  men  who  are  not  able 
to  earn  as  much  as  this.  They  can  still  be  employed  at 
lower  wages  than  the  average,  but,  for  the  protection  of 
the  union  rate,  it  is  stipulated  that  if  any  dispute  arises  the 
rate  of  wages  given  such  men  must  be  submitted  to  the 
local  Conciliation  Board  for  approval. 

Both  the  boards  of  conciliation  and  the  Court  of  Arbi- 
tration have  summary  powers  of  visiting  any  premises  and 
questioning  any  persons  concerned  in  an  industrial  dispute. 
They  can  compel  the  attendance  of  witnesses,  the  produc- 
tion of  any  books  and  papers  needed,  and  can  imprison  any 
one  refusing  to  obey  their  summons.  Every  precaution  is 
taken  by  the  act  to  prevent  injurious  publicity  of  the  secrets 
of  business.  The  hearings  are  public,  so  that  public  opinion 
may  be  properly  informed,  but  the  court  can  at  any  time, 
at  its  own  discretion  or  at  the  request  of  any  of  the  parties, 
go  into  secret  session. 

In  other  countries  than  New  Zealand  we  say  public  opin- 
ion is  the  supreme  court  in  determining  the  issues  between 
labour  and  capital,  but,  except  in  New  Zealand,  we  give  pub- 
lic opinion  neither  any  means  of  informing  itself  as  to  the 
facts  nor  of  effectuating  its  opinion  if  it  forms  one.  New 
Zealand  gives  the  court  power  to  ascertain  all  the  facts  by 
compulsion,  if  need  be,  and  then  places  in  its  hands  power 
to  enforce  the  conclusions  of  this  public  opinion.  In  Amer- 
ica the  public  are  helpless  to  learn  the  facts  of  a  dispute; 
in  New  Zealand  they  are  sure  of  learning  them  all  and 
correctly. 

There  is  a  new  "Song  of  the  Shirt"  in  New  Zealand  under 


NEW   SONG   OF   THE   SHIRT  267 

the  compulsory  arbitration  law.  The  employers  of  the  sew- 
ing women  in  Auckland  gave  notice  shortly  after  the  new 
law  came  into  effect  of  a  reduction  in  wages.  Under  the 
old  regime  of  the  woman  who  sits  in  unwomanly  rags,  with 
fingers  weary  and  worn,  these  sewing  women  would  have 
had  no  recourse  but  to  retreat  from  their  crust  and  tea  and 
garret  to  a  weaker  cup  of  tea  and  a  scantier  crust  and  a 
dingier  garret.  But  under  the  compulsory  arbitration  law 
the  old  "Song  of  the  Shirt"  is  a  "lost  chord"  in  New  Zea- 
land. In  this  case  the  women's  organisation  called  the 
manufacturers  into  court.  They  had  to  show  their  books 
and  to  make  good  every  statement  as  to  their  profits  and 
the  wages  their  women  were  earning.  While  this  debate 
was  proceeding  in  the  rooms  of  the  Arbitration  Court  the 
sewing  women  sat  secure  in  their  factories,  lighted  and  ven- 
tilated and  safeguarded  by  the  sanitary  and  other  care  of 
the  state,  and  their  work  went  on.  The  sewing  woman  did 
not  have  to  strike,  she  could  not  be  locked  out,  her  work 
could  not  be  taken  from  her,  her  wages  could  not  be  cut 
down  except  by  the  approval  of  the  court.  This  is  the  new 
Song  of  the  Shirt. 

One  of  the  by-products  of  the  arbitration  law  is  the  pre- 
vention of  frauds  on  the  public.  When  in  the  course  of 
investigation  of  any  labour  troubles  revelations  are  made 
of  frauds  practised  in  the  trade,  the  judges  in  their  awards 
can  make  rulings  which  will  put  an  end  to  them.  In  a 
dispute  in  the  tailor  trade  it  was  shown  that  it  was  the  prac- 
tice of  some  firms  to  deliver  to  customers  factory-made 
goods  on  orders  for  custom-made  clothing.  In  its  decision 
the  court  stopped  this  by  requiring  that  all  custom-made 
work  should  be  done  in  the  shop  of  the  employer.  The 
workingmen  know  and  resent  the  deceits  they  are  com- 
pelled to  perpetrate.  These  are  often,  as  in  this  case,  an 
injury  to  them  as  well  as  to  the  consumer,  for  they  are 


268         A   COUNTRY   WITHOUT   STRIKES 

forced  to  do  inferior  work  at  inferior  prices,  or  to  see  work 
that  they  should  do  go  to  others,  as  in  this  case.  The  open 
court  room  of  compulsory  arbitration  gives  them  the  chance 
to  let  out  the  trade  secret  and  protect  both  the  public  and 
themselves. 

The  workingman  or  employer  who  does  not  want  to  obey 
the  award  of  the  court  need  not  do  so.  There  is  no  com- 
pulsion to  work  or  to  keep  the  factory  open,  but  the  em- 
ployer who  closes  his  factory  can  reopen  it,  the  workingman 
who  leaves  his  work  can  begin  work  again,  only  in  exact 
compliance  with  the  terms  of  the  award.  The  award  may 
have  been  made  for  two  years.  Labourers  and  capitalists 
under  the  regime  of  private  war  amuse  themselves  by  try- 
ing to  starve  each  other  out,  careless  meanwhile  that  they 
are  starving  also  the  public  interests  concerned  in  the  in- 
dustry. But  these  tactics  are  futile  in  New  Zealand;  the 
state  cannot  be  starved  out. 

Any  workman  may  stop  work  and  any  employer  may  shut 
down  during  an  arbitration  or  after  an  award  for  any  good 
reason  other  than  to  escape  or  defeat  the  jurisdiction  of 
the  court,  but  it  will  be  of  no  use  for  him  to  stop  work  or 
shut  down  with  any  hope  of  evading  it.  The  working- 
man  can  come  back  to  work,  the  employer  can  reopen  his 
factory  during  the  life  of  an  award — and  this  may  be  for 
two  years — only  by  obeying  all  the  points  of  the  decision 
of  the  court. 

The  principal1  opposition  to  the  law  came  from  employers, 
but  they  are  now  seeing  that  it  can  be  of  as  much  service 
to  them  as  to  the  workingmen. 

One  of  the  most  interesting  uses  I  found  made  of  the 
law  was  to  protect  a  majority  of  the  employers  in  a  trade 
from  the  guerilla  competition  of  a  minority.  I  learned 
of  cases  where  manufacturers  were  actively  promoting  the 
organisation  of  their  employes  into  trades-unions,  for  an 


THESE  EMPLOYERS  LIKE  IT  269 

appeal  to  the  Court  of  Arbitration.  They  were  doing  this 
in  order  that  unscrupulous  competitors  might  be  restrained 
from  cutting  wages  in  order  to  enable  themselves  to  cut 
prices. 

One  of  the  largest  employers  of  the  colony  described  to 
me  the  situation  of  things  under  the  act  as  one  of  "perfect 
comfort."  "Under  the  old  system,"  he  said,  "our  differ- 
ences with  our  men  had  to  be  settled  by  a  brutal  fight. 
Now  two  committees  meet  before  the  court,  and  meanwhile 
the  industry  goes  on  just  as  if  nothing  were  the  matter." 

Another  large  employer  declared  that  for  the  first  time 
in  the  history  of  the  colony  manufacturers  now  are  able  to 
make  future  contracts  with  confidence,  since  the  awards 
fixed  all  the  conditions  of  labour  perhaps  for  years  ahead. 

In  the  report  recently  submitted  to  the  Victorian  govern- 
ment by  the  Honourable  R.  W.  Best,  its  Minister  of  Lands, 
after  a  tour  of  investigation  made  by  him  in  New  Zealand 
to  study  its  land  and  labour  laws,  he  quotes  the  following 
to  show  how  some  of  the  principal  employers  regard  the  act : 

"Speaking  at  a  special  meeting  of  the  Dunedin  Chamber 
of  Commerce,  on  October  19,  1897,  to  consider  certain 
bills  then  before  Parliament,  Mr.  James  Mills,  Managing 
Director  of  the  Union  Steamship  Company,  and  one  of  the 
largest  employers  of  labour  in  New  Zealand,  is  reported  by 
the  Otago  'Daily  Times'  to  have  said  that  'personally  he 
thought  the  Conciliation  and  Arbitration  Act  was  a  very 
beneficial  one  and  one  of  the  most  important  that  had  been 
passed,  and  he  felt  that  they  were  under  a  debt  of  gratitude 
to  the  present  government  and  to  Mr.  Reeves  for  maturing 
the  bill  in  its  present  shape.  Probably  the  measure  was 
capable  of  improvement,  and  it  would  be  improved  from 
time  to  time,  but  he  was  sure  that  compulsory  arbitration 
was  the  true  solution  of  all  labour  difficulties.' ' 

In  an  address  by  the  Right  Honourable  Richard  J.Seddon, 


2/0        A   COUNTRY   WITHOUT   STRIKES 

the  Premier  of  New  Zealand,  at  a  representative  gathering 
of  London  capitalists  interested  in  the  mining  industry,  one 
of  the  strongest  points  which  the  Premier  made  to  encour- 
age the  investment  of  English  capital  in  New  Zealand  mines 
was  the  stability  given  to  business  enterprise  by  the  arbi- 
tration law. 

"With  us,"  he  said,  "a  strike  of  the  miners  is  impossible, 
as  it  is  also  impossible  for  the  owner  of  the  mine  to  shut 
»down.  That  is  a  condition  of  things  which  does  not  pre- 
vail anywhere  else.  There  is  a  safeguard  for  you.  The 
result  has  been  this,  that  even  the  employers,  who  were  the 
first  to  object  to  that  legislation,  are  to-day  the  strongest 
in  favour  of  it,  because  where  they  have  strikes  of  any 
kind  where  there  is  a  large  amount  of  capital  invested  the 
effect  of  that  capital  being  laid  up  for  weeks,  and  exactions 
being  demanded  which  that  capital  could  not  bear,  would 
be  as  distastrous  as  it  would  be  to  our  mining.  The  law, 
as  it  stands  now,  has  prevented  disputes  which,  if  there 
had  been  an  industrial  struggle,  must  have  meant  a  loss 
of  about  a  million  of  money  to  us  as  a  small  community, 
whereas  the  whole  cost  of  the  proceedings  would  not 
amount  to  £1000." 

The  employers,  most  of  them,  like  compulsory  arbitra- 
i  tion.  It  enables  them  to  make  their  business  arrangements 
for  months  or  years  ahead  with  certainty,  and  without  the 
necessity  of  putting  "strike  clauses"  in  their  contracts.  It 
relieves  business  of  one  of  its  most  harassing  annoyances — 
the  perpetual  friction  with  labour.  A  little  easy  manoeu- 
vring with  the  men  brings  cut-thoat  competitors  before  the 
court  and  puts  them  under  the  compulsion  of  law  to  pay 
the  same  wages  and  give  the  same  treatment  to  their  men  as 
decent  employers  do. 

The  workingmen  like  compulsory  arbitration.  It  ensures 
them  at  all  times  and  under  all  circumstances  a  full  and 


WORKINGMEN   LIKE   IT  271 

fair  hearing  for  their  demands.  When  they  are  resisting  a 
reduction  or  demanding  an  increase  of  wages  it  enables 
them  to  learn  the  facts  of  the  situation  and  all  of  them.  It 
fixes  the  product  of  their  labour  not  by  a  false  "law  of  the 
market"  as  interpreted  by  the  greed  or  the  whip  hand  of  a 
master,  but  by  the  true  "law  of  the  market"  never  be- 
fore ascertainable.  For  the  first  time  in  civilisation  the 
organisation  of  labour  is  not  merely  tolerated,  but  given  a 
premium.  The  law  fixes  a  living  wage  or  a  minimum 
wage,  and  yet  allows  the  superior  man  all  the  advantage  his 
strength  and  skill  deserve.  Again  for  the  first  time  in 
history  the  toiler  has  found  a  place  where  he  meets  his 
employer  on  equal  terms,  with  no  temptation  to  cringe  or  to 
bully.  This  law  puts  in  the  hands  of  the  workman  an  irre- 
sistible means  of  stamping  out  the  moment  it  appears  in 
any  industrial  centre  the  first  tendency  to  sweat  the  working 
people. 

An  employer  in  any  part  of  the  country  detected  in  an 
attempt  to  cut  wages  or  worsen  conditions  can  be  called  be- 
fore the  court  and  straightened  out,  and  what  might  have 
developed  into  a  widespread  spoliation,  running  from  one 
competitor  to  another,  justified  by  this  merchant  because  it 
had  been  adopted  by  that  competitor,  is  arrested  at  the 
very  start. 

The  satisfaction  of  the  workingmen  is  universal,  and  this 
feeling  is  shared  by  the  labourers  of  other  colonies.  At  the 
Trades-Unions  Conference  in  Sydney,  New  South  Wales, 
in  1899,  it  was  resolved  that  the  New  Zealand  method  of 
compulsory  arbitration  was  the  most  satisfactory  one  for 
the  settlement  of  labour  disputes,  but  no  such  law  has  yet 
been  enacted  by  the  New  South  Wales  Parliament. 

It  must  not  be  supposed  that  strikes  are  impossible  under 
the  new  law.  Unorganised  workingmen  may  still  strike. 
There  can  be  no  arbitration  if  all  the  masters  and  all  the 


2J2  A 

men  in  a  dispute  agree  not  to  appeal  to  the  law.  Organ- 
ised labour  may  strike  if  not  registered  under  the  law.  If 
registered  it  may  withdraw  by  giving  three  months'  no- 
tice. There  have  been  one  or  two  unimportant  strikes,  but 
the  broad  fact  is  that  organised  labour  does  register,  does 
not  withdraw,  and  that  neither  it  nor  the  unorganised  men 
strike. 

When,  last  year,  an  important  amendment  to  the  law  was 
proposed  it  went  through  the  New  Zealand  Parliament  with- 
out a  word  of  opposition,  although  it  was  one  of  the  storm- 
iest and  angriest  sessions  which  had  been  held  for  many 
years.  If  any  real  damage  had  been  done  to  the  interests 
of  the  colony  by  the  law,  or  if  there  was  any  popular  feel- 
ing that  it  was  tyrannical,  then  was  certainly  the  oppor- 
tunity to  show  it.  The  principal  opposition  paper  of  the 
colony,  the  Otago  "Daily  Times,"  declares  that  it  is  im- 
possible to  assert  that  the  effect  of  the  law  has  been  in- 
jurious. 

But  in  the  administration  of  this  institution  it  is  being 
proved  again,  as  everywhere,  that  eternal  vigilance  is  the 
price  of  the  survival  of  any  good  thing.  Lawyers  are 
creeping  more  and  more  into  the  cases,  with  no  gain  in 
expedition  or  justice,  and  the  late  judge  of  the  court, 
Judge  Edwards,  now  succeeded  by  Mr.  John  C.  Martin,  for- 
merly Public  Trustee,  made  several  decisions  which  greatly 
limited  the  field  within  which  strikes  and  lock-outs  can  be 
prevented  by  law.  He  refused  to  allow  grocers'  clerks  the 
right  to  appear  in  the  Arbitration  Court,  ruling  that  theirs 
was  not  an  "industrial"  pursuit  and  consequently  not  en- 
titled to  the  benefits  of  arbitration.  And  the  same  judge 
excluded  street-car  men  and  livery-stable  employes  because 
not  engaged  in  "industrial"  pursuits.  These  decisions  have 
called  forth  a  great  deal  of  criticism  and  protest  in  New 
Zealand.  The  position  of  the  court  appears  to  be  that  no 


FALSE   PROPHECIES   OF   EVIL  273 

occupations  are  industrial  except  manufacturing.  It  is 
pointed  out  that  this  is  a  use  of  the  word  which  is  not  sup- 
ported by  any  philological  or  economic  authority,  nor  by 
any  other  judicial  authority.  The  principle  of  this  decision 
would  shut  out  seamen  from  the  arbitration  of  the  court, 
and  yet  it  was  to  save  New  Zealand  from  a  repetition  of  the 
maritime  strike  of  1890  that  the  law  was  primarily  passed. 
Public  opinion  in  New  Zealand  seems  to  favour  the  more 
sensible  view  that  where  strikes  and  lock-outs  are  there  is 
the  field  of  the  law  of  arbitration,  and  that  industrial  mat- 
ters are  any  that  involve  the  relation  of  capital  and  labour, 
of  employer  and  employe.  "The  reason  of  the  law  is  the 
law,"  Blackstone  says. 

The  evil  which  the  law  sought  to  remedy  was  not  eco- 
nomic civil  war  in  a  few  places,  but  in  all  places.  A  strong 
movement  is  now  being  made  in  the  Parliament  of  1900  to 
add  to  the  law  a  clause  which  shall  put  it  beyond  the  power 
of  any  such  interpretation  to  defeat  its  obvious  purpose. 
If  this  succeeds  we  may  expect  to  see  the  mercantile  as  well 
as  the  manufacturing  world  brought  within  the  sphere  of 
industrial  peace.  Premier  Seddon,  in  receiving  a  delega- 
tion bearing  a  protest  from  the  grocers'  clerks  against  their 
exclusion  from  the  Arbitration  Court,  declared  himself  in 
favour  of  an  amendment  of  the  law  which  would  bring  all 
workers  within  its  provisions,  and  this  will  undoubtedly  be 
achieved  in  the  legislation  of  this  year,  in  which  the  hand 
of  Mr.  Seddon  and  his  party  will  be  supreme. 

As  to  the  effects  of  the  law  on  public  welfare  the  facts 
are  eloquent.  It  was  predicted  that  the  experiment  of  arbi- 
tration would  introduce  an  era  of  industrial  disturbance 
which  would  be  fatal  to  the  prosperity  of  the  country. 
The  following  figures  of  the  number  of  hands  employed  in 
the  factories  of  New  Zealand  tell  how  this  prophecy  of  evil 
has  been  falsified. 


274        A   COUNTRY   WITHOUT   STRIKES 

Year  Hands  employed  Increase 

1895  29,879  4028 

1896  32»387  2508 

1897   36,9*8   4531 

1898   39>672   2754 

1899   45,305   5633 

In  Victoria  we  have  seen  that  the  exports  fell  off  in  some 
of  the  industries  affected  by  the  minimum  wage  law,  which 
is  a  kind  of  arbitration  law,  but  no  such  result  has  followed 
in  New  Zealand.  In  his  introduction  to  my  recent  book, 
"A  Country  Without  Strikes,"  the  Honourable  William 
Pember  Reeves  says : 

"The  only  serious  argument — beyond  the  theoretical  ob- 
jection to  state  interference  in  any  form — which  has  been 
brought  against  the  law  by  English  writers  has  been  a  state- 
ment that  it  has  hampered  enterprise  and  checked  the  growth 
of  manufactures  in  the  colony.  New  Zealanders  know  this 
to  be  quite  baseless,  for  they  know  that  the  manufactures 
of  their  colony  have  fully  participated  in  the  prosperity  of 
the  last  quinquennium.  For  some  years  past  labour  in 
almost  every  trade  has  been  fully  employed,  the  numbers  of 
the  workless  have  fallen  progressively,  new  factories  have 
been  opened,  new  buildings  erected,  and  the  shopkeepers 
who  deal  with  the  working  classes  admit  that  business  is 
better  and  bad  debts  fewer  than  at  any  time  in  the  last 
twenty  years  in  the  colony.  The  annual  reports  of  the 
chambers  of  commerce  and  the  periodical  reviews  of  trade 
and  business  published  by  the  New  Zealand  newspapers  on 
both  sides  in  politics  tell  the  same  tale." 

The  Compulsory  Arbitration  Court  of  New  Zealand  has 
an  aspect  of  even  greater  importance  than  the  industrial 
peace  which  is  assuredly  a  very  great  aspect.  In  this  arbi- 
tration court  New  Zealand  has  achieved  what  the  people  of 


INTERNATIONAL  ARBITRATION  275 

the  world  have  been  sighing  for  for  centuries — cheap,  uni- 
form and  speedy  justice.  It  points  the  way  to  the  realisa- 
tion of  the  dreams  of  quick  and  true  justice  for  all,  which 
is  the  greatest  need  and  the  dearest  hope  of  the  people  of 
the  world.  And  the  Compulsory  Arbitration  Court  of  New 
Zealand  is  a  light  on  a  hill  to  those  who  are  seeking  a  means 
of  establishing  international  arbitration.  The  nations  will 
get  arbitration  only  as  the  people  of  New  Zealand  got  it — 
by  compulsion.  When  the  nations  make  up  their  minds 
that  the  duty  of  arbitration  shall  be  mated  with  the  right  of 
arbitration,  and  that  as  no  nation  ought  to  fight  no  nation 
shall  fight,  and  that  as  every  nation  ought  to  arbitrate  all 
nations  shall  have  the  right  to  demand  arbitration,  and  when 
they,  as  the  people  of  New  Zealand  did,  create  a  tribunal 
with  the  power  to  enforce  these  rights  and  duties  and  to 
punish  any  people  that  violate  the  new  international  law, 
then,  and  not  till  then,  shall  we  have  the  possibility  of  inter- 
national arbitration.  Law  and  order  must  have  its  police- 
men between  nations  as  well  as  within  the  nations. 

The  only  country  in  the  world  where  there  have  been  no 
strikes  or  lock-outs  for  five  years  is  the  only  country  in  the 
world  that  has  a  compulsory  arbitration  law.  That  coun- 
try is  New  Zealand,  and  New  Zealand  is  to-day  not  only 
more  prosperous  than  it  ever  has  been  before,  but,  so  far 
as  my  observation  goes,  is  the  most  prosperous  country  in 
the  world.  Not  even  a  New  Zealand  advocate  of  compul- 
sory arbitration  would  claim  that  its  prosperity  was  due  to 
compulsory  arbitration,  but  the  prosperity  certainly  has  fal- 
sified all  the  predictions  that  disaster  would  follow. 


CHAPTER  XI 

QUARANTINING    THE    PANIC    OF    1893 

THE  panic  of  1893  struck  Australia  on  time  and  struck  it 
hard.  In  six  weeks  half  the  great  financial  concerns  of  the 
Australian  continent  went  to  the  wall.  This  meant  much 
more  there  than  it  would  mean  for  us,  for  the  Australasians 
are  the  most  highly  financed  people  in  the  world.  What  the 
statistician  calls  "the  banking  power  of  the  people"  is  greater 
there  than  anywhere  else.  We  of  the  United  States  then 
had  sixteen  times  the  population  of  Australia,  but  only  five 
and  one  half  times  its  banking  capital.  The  banking  power 
of  Great  Britain,  the  financial  centre  of  the  nations,  is  $120 
for  each  man,  woman  and  child,  but  for  young  and  distant 
Australia  it  is  $185  each. 

At  the  beginning  of  April,  1893,  the  four  millions  of  Aus- 
tralians had  a  banking  system  in  full  career,  with  assets  in 
round  numbers  of  $900,000,000.  In  May,  $450,000,000  of 
this  lay  in  ruins. 

Though  New  Zealand  was  in  its  track  the  cyclone  never 
arrived  there.  The  democracy  of  New  Zealand  does  not 
believe  in  the  alleged  immutability  of  the  laws  of  nature, 
including  the  laws  of  trade.  This  high  area  of  money  dis- 
turbance on  its  way  from  Australia  in  1893  was  successfully 
countered  by  a  more  powerful  anti-cyclonic  pressure  gener- 
ated by  the  wit  of  democracy.  At  that  time,  1893,  the  Bank 
of  New  Zealand  was  a  private  institution,  largely  owned  in 
London,  but  it  was  the  chief  bank  of  the  colony,  and  kept 

276 


BETTER  THAN  GOLD  277 

the  cash  of  all  the  principal  business  concerns  and  the  funds 
of  nearly  every  public  body,  including  the  general  Treas- 
ury. There  were  1486  of  these  public  accounts,  among 
them  charitable  aid,  town  and  road  boards  and  633  school 
committees.  The  government  had  nearly  $10,000,000  on 
deposit,  and  in  this  was  the  money  of  its  Postal  Savings 
Bank.  There  were  also  a  number  of  private  savings  bank 
balances.  The  bank  had  $55,000,000  of  the  $76,000,000 
of  the  banking  assets  of  the  colony.  One  sixth  of  the  popu- 
lation was  directly  involved  in  its  fate.  It  had  $22,000,000 
of  deposits  belonging  to  35,000  depositors.  These  figures 
are  not  small  even  to  us. 

New  Zealand's  remoteness  and  its  insular  independence 
made  the  earthquake  wave  of  panic  move  slowly  toward  it. 
No  signs  of  trouble  were  visible  to  the  public  when,  in  1893, 
the  banks  held  a  meeting  and  asked  for  a  legal  tender  law 
like  that  which  had  been  passed  by  Parliament  in  New 
South  Wales  earlier  in  the  same  year. 

This  legal  tender  law  was  not  what  we  should  understand 
by  that  term.  It  authorised  the  banks  to  issue  a  dollar  of 
circulation  for  every  dollar  of  property  they  had  in  excess 
of  what  they  owed.  But  it  also  obliged  the  Treasury  to 
give  gold  for  these  notes  whenever  presented.  By  this 
law,  in  other  words,  it  offered  to  guarantee  all  the  notes  and 
to  cash  in  gold  the  surplus  assets  of  the  banks  to  the  last 
dollar  if  necessary.  This  made  their  surplus  liquid,  as 
bankers  say — not  merely  as  good  as  gold,  but  as  good  as 
gold  coin,  which  is  something  even  better. 

This  offer  of  relief  made  the  relief  unnecessary.  The 
banks  found  no  need  to  use  the  new  privilege  given  them, 
and  their  issues  of  notes  actually  declined.  For  another  en- 
tire year,  until  June,  1894,  the  smooth  current  of  New  Zea- 
land business  went  on  without  a  ripple,  while  all  the  rest  of 
the  world  was  passing  through  failure  and  liquidation. 


278 

During  the  year  1894  there  was  a  decline  of  only  $68,000 
in  the  banking  deposits  of  the  colony,  and  a  contraction  of 
about  $1,250,000  in  the  loans;  prices  were  falling,  but  the 
shrinkage  in  revenue  and  exports  and  imports  was  slight, 
and  the  country  was  prosperous. 

But  on  Friday,  June  29,  1894,  Parliament  and  the  Min- 
istry were  thunderstruck  to  learn  from  the  officials  of  the 
Bank  of  New  Zealand  that  that  institution  would  not  be 
able  to  open  its  doors  on  Monday  morning  unless  it  had 
help.  There  was  but  one  day  to  decide  what  to  do  and  to 
put  into  law.  It  was  not  a  question  of  saving  the  bank, 
but  saving  the  country.  Its  welfare  for  a  generation  was 
at  stake.  Parliament,  putting  all  party  differences  aside, 
by  an  overwhelming  majority  passed,  without  change, 
a  measure  presented  by  the  Ministry.  It  acted  without 
any  other  information  about  the  bank  and  the  crisis  than 
the  assurance  of  the  Ministry  that  the  bank  was  sound  and 
would  weather  the  storm  if  assisted. 

That  in  this  leap  into  the  dark  Parliament  was  following 
blind  leaders  did  not  appear  until  afterward;  fortunately 
so,  for  if  the  Ministry  and  Parliament  had  known  what  they 
found  out  later,  their  power  of  action  would  have  been 
crippled,  as  happens  to  those  who  know  too  much. 

By  this  legislation  Parliament  granted  an  advance  from 
the  colony  to  the  bank  of  $10,000,000,  repayable  in  ten  years 
— in  1904.  The  money  was  got  by  the  sale  in  London  of 
$10,000,000  of  bank  stock  paying  four  per  cent,  a  year  guar- 
anteed by  New  Zealand.  In  addition  the  stockholders  were 
called  upon  to  pay  up  $2,500,000  on  their  reserve  liability. 
The  government  inserted  the  head  of  the  camel  of  public 
ownership  into  the  tent  of  this  private  bank,  by  putting  a 
representative  of  its  own  at  its  head  as  president,  with  the 
right  of  veto  on  any  transaction,  and  subjected  the  manage- 
ment to  the  scrutiny  of  a  public  auditor. 


A  WRECK  279 

As  happened  under  the  Legal  Tender  Act  of  1893,  tran- 
quillity followed.  There  was  another  year  of  peace  in 
New  Zealand,  and  in  New  Zealand  alone,  for  everywhere 
else  the  boa-constrictor  of  panic  contraction  was  crushing 
trade  and  industry  in  the  pitiless  way  the  business  man 
struggling  with  bankruptcy,  and  the  workingman  tramping 
the  roads  for  work,  know  so  well. 

But  in  1895  again  out  of  a  clear  sky  and  with  no  warn- 
ing the  Ministry  came  to  Parliament  with  the  announce- 
ment that  the  bank  for  which  they  had  done  so  much,  on  the 
assurance  that  if  done  all  would  be  safe,  had  been  found  by 
the  president  and  the  auditor  put  in  by  Parliament  to  be 
practically  a  wreck.  All  the  capital  was  gone.  Of  the  bank's 
nominal  assets  of  about  $55,000,000,  over  $13,000,000  were 
but  the  refuse  of  sheep  ranges  and  other  real  estate,  which 
had  been  taken  on  foreclosure  from  its  reckless  borrowers  by 
this  reckless  lender.  The  good  properties  had  long  since 
been  sifted  out  and  sold.  Every  effort  had  been  made  by 
the  representatives  of  the  state  to  retrench  and  rebuild,  but 
this  burden  of  dead  real  estate  had  been  found  to  be  too 
heavy  to  be  borne. 

"There  is  still  a  magnificent  portion  of  the  business  which 
is  sound,"  Parliament  was  told  by  its  representative  in  the 
bank;  "but  unless  this  load  of  effete  matter  is  lifted  the 
bank  can  no  longer  be  carried  on." 

Unless  immediate  help  is  given,  "such  a  calamity  will 
result,"  he  continued,  "as  has  never  yet  been  experienced 
by  any  British  colony." 

This  was  sickening.  The  Ministry,  on  the  strength  of  the 
assurances  given  them,  had  assured  Parliament  the  year  be- 
fore that  the  bank  was  solvent,  and  that  the  loan  of  $10,000,- 
ooo  would  launch  it  anew  upon  a  career  of  prosperity  with- 
out the  loss  of  a  cent  to  the  people.  Now  the  truth  came 
out  that  the  bank  was  gone,  and  the  $10,000,000  were 


280     QUARANTINING  THE  PANIC  OF   1893 

gone  also  unless  the  Treasury  put  in  still  more  millions. 
The  same  Ministry  was  still  in  power,  and  friends  and 
enemies  united  in  the  outbursts  of  indignation  with  which 
this  news  was  received.  But  a  joint  committee  of  both 
houses  of  Parliament  and  of  both  parties  found,  upon  in- 
vestigation, that  the  bad  news  was  true  and  that  whoever 
was  to  blame  the  bank  could  not  survive  without  further 
relief.  It  unanimously  recommended  that  this  be  given. 

After  less  than  a  week's  debate  Parliament  went  in 
$15,000,000  deeper.  It  did  this  by  taking  preferred  stock 
in  the  bank  to  the  amount  of  $2,500,000 — making  itself  the 
largest  stockholder — and  by  guaranteeing  the  bank  to  the 
extent  of  $13,000,000  against  all  losses  on  the  sale  of  its 
derelict  real  estate.  This  was  the  full  nominal  value,  and 
was  admittedly  at  least  $4,250,000  more  than  the  real  value. 
Then  Parliament  divorced  the  bank  from  the  land  business 
in  which  it  should  never  have  been  embarked.  The  real 
estate  was  taken  out  of  its  hands,  and  a  company  especially 
formed  to  market  it.  The  state  by  its  guarantee  practically 
enabled  the  bank  to  cash  all  the  land  that  it  had  to  take  for 
bad  debts — $13,000,000 — and  assumed  itself  the  weary  task 
of  selling  it  off,  which  was  certain  to  consume  many  years 
and  involve  heavy  losses. 

The  stockholders  were  again  called  upon  and  summoned 
to  pay  in  $5,000,000  more  on  their  reserve  liability,  if  they 
could  raise  it,  as  many  of  them  could  not.  The  bank  was 
empowered  to  buy  a  competing  bank  to  increase  its  chances 
of  making  money.  The  business  of  the  colony  in  Lon- 
don was  taken  from  the  Bank  of  England  and  given  to  the 
Bank  of  New  Zealand  to  add  to  its  earnings,  and  a  gov- 
ernment director  was  put  on  the  board  of  management. 

As  a  method  of  relief  this  was  far  more  effective  than  such 
a  proceeding  as  that  of  the  State  of  New  York,  which,  in 
our  panic  of  1837,  passed  a  law  suspending  all  rights  of  the 


TWO   HUNDRED   MILLIONS  281 

people  to  proceed  against  the  banks  for  the  enforcement  of 
their  obligations. 

In  all,  in  these  three  years,  1893,  1894  and  1895,  the  gov- 
ernment and  the  people — only  750,000  of  them — went  in  to 
the  tune  of  $37,500,000  made  up  as  follows:  $10,000,000 
in  1893  f°r  tne  guarantee  of  the  note  issue  which  they  did 
not  have  to  make  good,  as  the  circulation  was  not  needed 
by  the  business  of  the  colony  and  was  never  put  out;  $10,- 
000,000  in  1894  for  the  guarantee  of  the  bank  stock;  $13,- 
500,000  in  1895  guaranteed  the  bank  on  the  sale  of  its  real 
estate;  and  $2,500,000  for  the  new  stock  subscribed  for  by 
Parliament. 

Adding  to  all  this  the  $7,500,000  which  the  stockholders 
were  called  upon  to  pay  in,  we  have  a  total  of  $45,500,000 
as  the  sum  for  which  the  people  and  the  stockholders  be- 
came liable  to  rehabilitate  this  concern.  Leaving  out  the 
$10,000,000  liability  on  the  guarantee  of  the  notes,  which 
was  never  called  for,  the  total  advances  by  the  state  to  this 
private  bank  reached  the  sum  of  $26,000,000. 

Against  this  the  colony  has  for  its  reimbursement  what 
it  can  get  out  of  the  sale  of  the  real  estate — there  is  cer- 
tain to  be  a  loss  of  at  least  $5,000,000  on  this  item — and 
whatever  the  bank  can  repay  from  its  profits,  all  of  which  are 
ear-marked  for  its  indebtedness  to  the  state,  excepting  a  lim- 
ited sum  conceded  to  those  stockholders  who  have  responded 
to  all  the  calls  made  on  them. 

These  advances  were  practically  an  addition,  and  a  very 
considerable  one,  to  the  public  debt  of  the  country,  which 
already  in  1893  was  in  round  numbers  $200,000,000,  but 
they  do  not  appear  in  the  debt  statements.  For  the  express 
purpose,  among  other  things,  of  avoiding  all  appearance  of 
debt  expansion,  the  new  obligations  were  created  in  the  form 
of  guaranteed  bank  stock,  guaranteed  real  estate  debentures 
and  Treasury  purchase  of  bank  stock. 


When  Parliament  in  1894  was  scared  into  a  panic  lest 
there  should  be  a  panic,  and,  under  the  whip  of  the  ministe- 
rial majority,  put  through  in  a  one  night  session,  between 
two  days,  an  advance  of  public  money  of  $10,000,000  to  this 
private  bank,  it  supposed,  and  there  is  no  doubt  the  Ministry 
also  supposed,  that  the  bank  was  an  honest  bank  and  solvent, 
but  caught  through  no  fault  of  its  own,  in  one  of  the 
whirlpools  of  the  financial  deluge  that  had  just  swept 
Europe  and  America  and  Australia,  and  that  it  needed  only 
a  temporary  lift  to  right  itself. 

But  the  representatives  of  Parliament  who  went  into  the 
bank  to  protect  its  advances  found  that  the  Ministry  and 
Parliament  had  been  deceived,  and  that  the  institution  was 
in  the  condition  in  which  the  sister  of  Lazarus  thought  his 
body  must  be  after  it  had  been  three  days  in  the  tomb. 

Worse  still,  the  truth  gradually  forced  itself  into  recog- 
nition that  the  affair  with  the  Ministry  and  Parliament, 
June  29,  1894,  was  a  coolly  planned  scheme  of  the  directors 
and  leading  stockholders  to  throw  upon  the  country  the 
liabilities  of  a  bank  after  they  had  swallowed  its  assets.  It 
was  a  "raid"  arranged  in  London.  The  command  of  it 
was  entrusted  by  the  London  capitalists  concerned  to  a  man 
whom  they  sent  on  from  that  city,  because  they  knew  he 
had  the  confidence  of  the  colonists,  as  he  had  once  lived 
among  them,  and  had  been  in  the  management  of  this  very 
Bank  of  New  Zealand.  Hastening  from  London  to  Wel- 
lington this  gentleman  opened  fire. 

"There  was  a  revolver  pointed  at  our  heads,"  the  Premier 
afterward  told  Parliament. 

"If  the  bank  and  the  country  are  to  be  saved  from  ruin, 
the  bank  must  have  $10,000,000,"  this  gentleman  said  at  a 
conference  with  the  Ministry  and  the  leaders  of  Parliament 
at  three  o'clock  in  the  morning,  and  it  must  have  it  "to-day," 
and  "to-day"  he  got  it. 


A   BIG   HOLE   TO   FILL  283 

The  letter  in  which  he  formulated  this  demand  and  the 
act  of  Parliament  responding  to  his  "hold-up,"  bear  the 
same  date,  June  29,  1894.  In  this  letter  he  gave  the  assur- 
ance that  "this  does  not  imply  that  any  heavy  losses  in  the 
bank's  business  have  been  made.  To  the  best  of  my  knowl- 
edge and  belief  no  such  losses  have  been  made." 

Upon  his  arrival  from  London  three  weeks  before,  he  had 
been  given  a  statement  prepared  by  the  officers  of  the  bank, 
showing  a  loss  of  $5,877,000  on  the  real  estate  transactions 
alone;  but  he  "forgot"  this,  saying  only  in  an  off-hand  way 
that  there  was  "a  big  hole  to  fill."  The  statement  of  the 
bank  which  he  submitted  showed  a  profit  on  the  last  year's 
business.  When  asked  what  security  there  would  be  for  the 
$10,000,000  demanded,  he  pointed  to  the  "paid-up  capi- 
tal" of  $4,500,000  and  the  stockholders'  reserve  liability 
of  $7,500,000,  and  declared  it  was  not  to  be  questioned  that 
that  was  an  "ample  margin."  But  this  capital  was  then 
all  gone ;  every  cent  of  it  lost. 

He  assured  Parliament  in  the  strongest  language  that  by 
the  advance  of  ten  millions,  "the  state  will  not  lose  one 
penny." 

He  was  a  shrewd  fellow  and  knew  his  people.  He  sugared 
his  pill  with  talk  about  this  opportunity  for  New  Zealand  to 
establish  for  itself  "a  national  bank,"  like  "the  great  nations 
of  the  old  world." 

The  owners  of  the  bank  had  squeezed  out  dividends  as 
long  as  there  was  a  cent  squeezable,  and  then,  and  not  till 
then,  they  saw  the  admirable  advantages  of  a  "state  bank." 

What  he  said,  Parliament  did,  and  did  it  "to-day,"  and 
London  knew — it  was  afterward  discovered — what  Parlia- 
ment did  before  it  was  done.  A  friend  of  this  man  said  in 
Parliament  the  year  after,  "He  is  very  astute,  and  capable 
and  careless  hearers  might  be  led  to  erroneous  conclusions 
by  such  a  gentleman." 


284     QUARANTINING  THE  PANIC  OF   1893 

As  soon  as  the  work  he  had  been  sent  to  do  was  accom- 
plished he  left  the  country.  When  asked  in  Parliament 
where  this  "astute"  gentleman  was,  the  Premier  could  only 
reply,  "Where,  O  where?"  He  went  to  South  Africa,  but 
evidently  he  did  not  organise  the  Jameson  raid,  for  had  he 
been  its  leader  it  would  have  been  successful. 

A  legislative  investigation  disclosed  that  the  bank  had 
been  in  an  unsound  condition  since  1888,  and  that  the  direc- 
tors had  been  paying  dividends  which  were  not  earned.  A 
large  part  of  the  losses  had  been  due  to  loans  which  the 
directors  had  made  to  themselves,  not  only  on  insufficient 
security,  but  under  circumstances  which  led  a  committee  of 
stockholders,  in  1888,  to  hint  at  the  desirability  of  criminal 
proceedings.  Between  1888  and  1893,  when  the  bank  was 
unloaded  on  Parliament  under  cover  of  the  threat  of  a  panic, 
its  directors  had  paid  out  $1,328,000  in  dividends,  some- 
times seventeen  and  one  half  per  cent,  a  year,  and  alto- 
gether nearly  one  hundred  and  fifty  per  cent,  on  the  amount 
of  its  paid-up  capital.  And  yet,  during  these  very  years, 
the  bank  was  making  losses  at  the  rate  of  $8400  every  day, 
a  total  of  $20,000,000  in  all,  of  which  $15,453,000  were 
plainly  confessed  by  being  "written  off." 

During  a  large  part  of  this  mad  career  of  financial  dis- 
sipation the  gentleman  who  had  "put  the  revolver  to  our 
heads"  in  1894  had  been  active  in  its  management.  A  ring 
of  directors  and  speculators  had  used  the  money  of  the  de- 
positors and  stockholders  to  financier  swindling  "booms" 
in  land.  As  bank  directors  they  made  loans  to  themselves  as 
land  speculators.  "Undrained  swamps  and  barren  hilltops," 
anything  that  there  was  a  chance  to  sell  at  a  profit  to  the 
gullible  public  was  good  enough  security  for  these  men. 
The  bank  had  been  the  greatest  enemy  of  the  bona  fide 
settlement  of  the  people  on  the  land,  and  had  been  the 
friend  of  the  land  grabber  and  jobber. 


A   FAILURE  OF  JUSTICE  285 

"For  twenty-five  years  the  management  had  been  so  reck- 
lessly extravagant  that  no  words  could  be  found  too  strong 
to  characterise  it,"  was  said  by  one  of  the  members  of  Par- 
liament. , 

"This  inflated  concern  has  hung  over  the  colony  for  years 
like  a  nightmare,"  said  another. 

"We  have  found  it  to  be  a  den  of  gambling,  dishonesty 
and  rascality,  and  we  have  not  yet  reached  the  bottom  of 
it,"  said  still  another. 

The  stockholders'  committee  in  1888  had  threatened  crim- 
inal proceedings  against  the  directors  who  had  paid  divi- 
dends that  had  not  been  earned.  Immediately  upon  this 
intimation  that  the  directors  should  be  punished,  some  one 
appeared  in  the  lobby  of  Parliament  and  obtained  the  pas- 
sage of  a  law,  almost  in  silence  and  without  a  division, 
which  not  only  allowed  them  to  continue  paying  such  un- 
earned dividends,  but  "looked  backward"  and  legitimised 
their  illegal  and  probably  criminal  acts  in  paying  them  in 
preceding  years.  Commenting  on  this  one  of  the  members 
of  Parliament  said : 

"At  all  times  we  have  found  that  capital  exercises  an  un- 
due influence  on  the  legislature." 

Whatever  the  Bank  of  New  Zealand  wanted  from  the 
government  it  was  always  able  to  get. 

A  loud  cry  for  punishment  arose  in  Parliament  when  the 
rotten  character  of  the  institution  was  made  clear.  One  of 
the  special  objects  of  a  Parliamentary  committee  of  1896 
was  to  uncover  the  guilty  men  and  ascertain  the  exact  facts 
on  which  they  could  be  indicted  and  tried ;  but  the  man  who 
had  been  made  president  of  the  bank  by  Parliament  to  pro- 
tect its  interests  refused  to  testify  on  this  point.  Others 
who  knew  the  facts  followed  his  example.  The  investiga- 
tion became  a  farce  and  the  matter  was  allowed  to  slip  out 
of  "practical  politics." 


286     QUARANTINING  THE  PANIC  OF   1893 

In  Australia,  for  some  reason,  the  fate  of  swindling  bank 
managers  and  directors  was  very  different.  Scores  of  them 
were  sent  to  jail  and  stayed  there  for  years.  Perhaps  the 
fact  that  the  panic  was  averted  in  New  Zealand  and  the 
public  was  not  maddened  into  vengeance  accounts  for  the 
failure  of  justice.  The  members  of  the  Ministry  pledged 
themselves  to  pursue  the  matter  "as  sure  as  the  sun  rises 
to-morrow,"  and  to  find  out  and  punish  those  "who  are  now 
living  in  wealth  and  luxury  at  the  expense  of  the  poor  un- 
fortunate stockholders  and  taxpayers  of  New  Zealand,"  but 
nothing  has  been  done  to  redeem  the  promise. 

Although  these  damning  facts  came  out  in  all  their  de- 
pressing details  in  the  year  after  Parliament  made  its  first 
advance  of  ten  millions,  and  while  it  was  deliberating  what 
to  do  further,  if  anything,  "not  a  single  member"  of  the 
joint  committee  representing  both  parties  and  both  houses 
of  Parliament,  appointed  to  discover  the  truth  and  make  a 
plan,  "thought  for  a  moment,"  as  one  of  its  members  said  in 
the  debate,  "of  allowing  the  bank  to  stop,"  and  Parliament 
took  the  same  view  by  a  large  majority. 

It  was,  perhaps,  the  severest  test  of  its  good  sense  and 
good  temper  the  New  Zealand  democracy  has  ever  had. 
The  country  had  dropped  $10,000,000  into  a  bottomless  pit, 
and  was  asked  to  drop  in  some  $15,000,000  more  to  save 
itself  by  saving  a  bank  which  was  incontestably  a  sink  of 
financial  corruption  and  incompetence.  What  made  action 
favourable  to  the  bank  especially  bitter  to  the  Liberal  party 
then  in  power,  was  that  the  institution  had  always  been 
one  of  the  bulwarks  of  "conservatism,"  and  had  thrown  all 
its  influence  against  the  progressive  policy  of  the  people. 
Political  processions  of  the  Liberal  party  marching  along  the 
streets  would  stop  cheering  when  they  came  to  the  building 
of  the  Bank  of  New  Zealand  and  give  it  rounds  of  dismal 
groans. 


A  PENALTY  FOR   FOLLY  287 

"It  was  the  greatest  foe  of  liberalism  in  the  country,"  a 
Liberal  said  in  Parliament,  but  still  he  supported  the  bill 
to  keep  it  afloat. 

Parliament  undoubtedly  represented  public  opinion  cor- 
rectly in  not  allowing  its  indignation  and  resentment  to 
blind  it  to  the  true  issue.  It  was  urged,  in  and  out  of  Par- 
liament, when  the  first  appeal  was  made  in  1894,  that  there 
was  nothing  in  the  circumstances  of  New  Zealand  that 
threatened  it  with  panic.  Prices  were  low,  speculation  ab- 
sent, indebtedness  not  inflated.  The  bank,  it  was  said, 
should -be  left  to  dig  its  way  out  of  the  pit  it  had  digged 
itself  into  or  to  perish  there. 

But  the  great  fact  was,  and  the  democracy  saw  it,  that 
this  private  bank  was  the  source  of  supply,  the  dealer  in 
control,  of  the  greatest  necessity  of  modern  life — credit, 
on  which  the  production  and  distribution  of  all  the  other 
necessities  depend.  It  owned  the  most  important  piece  of 
machinery  in  the  colony.  It  was  the  heart  of  the  inflow  and 
outflow  of  the  country's  industrial  blood.  This  administra- 
tion of  credit  was  a  great  public  trust.  When  the  trustees 
abused  their  trust,  the  public  had  neglected  either  to  control 
them  or  to  assume  the  trust  itself. 

The  million  or  two  that  might  be  lost  now  was  a  penalty 
for  the  belated  recognition  of  the  folly  of  leaving  an  article 
of  such  universal  necessity  as  credit,  to  be  exploited  by  a 
private  enterprise  at  its  own  sweet  will.  It  was  a  price  the 
public  had  to  pay,  for  awakening  to  the  public  interest,  in  an 
economic  function  not  less  important  than  the  national  de- 
fense against  a  foreign  foe;  but  it  was  also  a  cheap  price  to 
pay  for  escape  from  such  devastation  as  the  people  of  New 
Zealand  had  just  seen  sweep  over  Australia  and  Europe  and 
America. 

This  was  the  situation  of  New  Zealand,  and  the  common 
sense  that  saw  this  point  and  acted  on  it  was  the  common 


288     QUARANTINING  THE  PANIC  OF   1893 

sense  of  the  average  man.  Some  of  the  most  successful 
business  men  in  Parliament,  and  some  of  the  members  most 
experienced  in  public  life,  opposed  every  suggestion  of  re- 
lief. Thirty-three  of  the  members  were  new  men.  Par- 
liament was  denied  all  information  except  that  there  was  an 
emergency.  The  other  bankers  in  the  colony  could  not  be 
summoned  to  advise,  for  they  were  representatives  almost 
wholly  of  foreign  houses  and  competing  banks;  and  this 
was  a  crisis  which  must  be  settled  on  New  Zealand  lines 
for  New  Zealand. 

There  was  no  time  to  deliberate  over  a  plan  for  "nation- 
alising" the  credit  machinery.  Do  what  we  demand  and  do 
it  "to-day,"  the  men  in  possession  of  the  machinery  said, 
or  we  will  blow  the  whole  thing  up,  you  and  ourselves  in- 
cluded. 

Had  the  bank  stopped  as  these  men  threatened,  all  the 
money  of  the  government  would  have  been  locked  up  in 
London,  and  at  home  its  savings  bank  depositors  would  have 
been  unable  to  draw  their  money ;  the  Public  Trust  office  and 
Life  Insurance  Department  and  the  Advances  to  Settlers  of- 
fice would  have  been  crippled;  the  35,000  depositors  of  the 
bank  would  have  been  left  without  funds  to  carry  on  their 
business  or  to  pay  their  current  bills ;  the  thousands  of  bor- 
rowers would  have  been  called  upon  to  pay  their  loans — 
$75,000,000 — at  a  moment  when  they  would  have  been  un- 
able to  get  money  anywhere  else,  and  could  have  sold  their 
property  only  at  ruinous  sacrifices.  Industry  would  have 
been  suspended,  workingmen  and  women  thrown  out  of 
work,  forced  sales  would  have  started  the  prices  of  mer- 
chandise and  land  on  a  downward  grade.  Imports  would 
have  declined,  and  with  them  the  customs  revenue.  The 
receipts  of  the  railroads  would  have  followed  the  same 
course.  There  was  a  foreign  trade  in  and  out  of  $65,000,- 
ooo  a  year,  and  a  private  wealth  in  land,  improvements, 


THE   BETTER   BANKER  289 

machinery,  merchandise  and  other  property  of  $750,000,- 
ooo,  all  dependent  upon  the  maintenance  unimpaired  of  the 
credit  system  of  the  country.  The  failure  of  the  bank 
would  have  been  a  stroke  of  paralysis  followed  by  death 
for  many  and  slow  recovery  for  the  rest. 

This  was  the  situation  with  which  a  surprised  Parliament 
found  itself  faced  on  the  morning  of  June  29,  and  which 
had  to  be  settled  "to-day." 

The  democracy,  though  inexperienced  and  taken  by  sur- 
prise and  deceived,  has  proved  itself  a  better  banker  than 
the  "private  enterprise"  which  affects  such  scorn  for  the 
"state" — except  when  it  wants  some  privilege  from  it. 

The  Premier  said  in  1893,  in  Parliament,  that  he  would 
not  allow  any  bank  in  the  colony  to  fail.  The  remark  was 
received  with  cheers  on  all  sides  of  the  house.  The  people 
and  their  representatives  had  not  the  slightest  notion  how 
serious  was  the  responsibility  they  assumed,  when  the  hour 
struck  the  next  year  for  them  to  redeem  this  jaunty  promise. 
Yet,  though  so  inexperienced,  their  performance  has  been  so 
successful  that  it  is  well  worth  the  study  of  democracy 
everywhere  else.  As  Lowell  says,  the  world  has  come  to 
have  but  one  set  of  nerves,  and  we  all  have  the  same  head- 
ache at  the  same  time. 

First.  The  democracy  prevented  the  panic  which  the 
private  banker  had  prepared. 

Second.  The  frauds  were  investigated  to  the  bottom 
which  private  banking  had  perpetrated  and  concealed. 

Third.  For  the  first  time  the  New  Zealanders  now  have 
a  bank  which  they  know  all  about  and  they  are  the  only  peo- 
ple who  have  this.  The  kind  of  thing  that  has  gone  on 
behind  the  scenes  in  many  another  country  in  Europe  and 
America,  but  has  been  sedulously  kept  behind  the  scenes, 
has  been  democratically  spread  out  in  this  New  Zealand 
experience  for  everyone  to  look  at. 


290     QUARANTINING  THE  PANIC  OF   1893 

Fourth.  Under  democracy  all  the  revelations  of  finan- 
cial unsoundness  were  published  to  the  world  without  pro- 
ducing the  slightest  ripple  of  disaster.  The  merest  whis- 
per of  such  publicity  would  have  sent  a  private  bank  to 
the  wall. 

Fifth.  The  stockholders  who  had  allowed  their  directors 
to  wreck  the  bank,  were  compelled  to  make  good  their  re- 
serve liability  to  the  utmost  farthing  of  their  ability. 

Sixth.  In  the  Australian  liquidation  the  depositors  had 
to  lose  part  of  their  money.  They  were  "impounded"  as 
the  word  is.  In  New  Zealand  the  depositors  lost  nothing. 

Seventh.  The  funds  which  should  have  been  kept  liquid 
for  daily  use  the  capitalists  locked  up  in  real  estate  specu- 
lations which  dragged  on  for  years.  The  democracy  sepa- 
rated the  land  business  from  the  banking  business,  and 
cleared  up  all  the  bad  debts,  real  estate  and  other. 

Eighth.  The  government  put  in  all  the  new  capital  re- 
quired. 

Ninth.  The  stockholders  for  twenty  years  had  been  un- 
able to  install  directors  who  would  direct.  But  the  state 
has  got  itself  honestly  and  intelligently  represented. 

Tenth.  The  democracy  shrewdly  bought  another  bank 
to  reduce  competition  and  get  the  benefit  of  consolidation. 

Eleventh.  The  government,  because  it  is  the  govern- 
ment, is  able  to  get  capital  cheaper  than  the  bank  when  in 
private  hands.  It  borrowed  in  London  at  four  per  cent. 
The  bank  would  have  had  to  pay  at  least  six. 

Twelfth.  For  the  first  time  this  great  organ  of  the  finan- 
cial life  of  the  colony  is  under  the  regime,  which,  in  its 
motive,  takes  equal  account  of  the  welfare  of  the  borrowers, 
stockholders  and  the  general  public.  The  private  director 
might  think  of  all  these,  might  wish  he  could  consult  all 
these  interests,  but  he  would  be  Utopian  and  a  bankrupt  if 
he  allowed  his  action  to  be  influenced  by  them.  But  that 


RECUPERATIVE  DEMOCRACY     291 

democracy  should  be  so  influenced  is  a  matter  of  course  and 
helps,  not  hinders,  its  success. 

Thirteenth.  Notwithstanding  all  the  dark  predictions  at 
the  time,  it  now  promises  that  none  of  the  money  advanced 
will  be  lost,  and  that  the  stockholders  who  have  been  able 
to  keep  their  stock  paid  up  will  be  saved.  They  would  cer- 
tainly have  been  ruined  either  by  the  continuance  of  the 
old  management  or  by  liquidation.  At  the  last  meeting  of 
the  stockholders  to  elect  the  two  directors  to  whom  they  are 
now  limited,  it  was  shown  that  there  was  a  prospect  of  divi- 
dends in  a  future  not  very  remote. 

These  anticipations  are  confirmed  by  the  last  report  of 
the  business  of  the  bank  laid  before  Parliament  in  July, 
1899.  The  deposits  and  loans  are  up  to  their  former  level. 
The  bank  is  paying  interest  on  all  its  obligations,  and  is  re- 
ducing the  principal  of  its  indebtedness  out  of  its  profits. 
It  is  earning  the  interest  on  all  the  money  advanced  and 
invested  by  the  Treasury.  In  addition,  it  is  also  paying  to 
the  Treasury  out  of  its  profits,  as  provided  for  by  the  scheme 
of  liquidation,  $250,000  a  year  toward  the  losses  which  are 
made  in  the  sale  of  the  bank's  "cats  and  dogs"  of  real  estate. 
The  sale  of  this  real  estate  is  proceeding  at  a  rate  which 
promises  a  total  loss  of  about  $5,000,000,  but  this  will  not 
fall  on  the  state,  but  on  the  bank  which  must  make  it  up 
out  of  its  profits.  It  paid  last  year  $250,000  toward  this 
deficit,  and,  as  its  profits  increase,  its  contributions  to  the 
deficit  will  increase. 

The  New  Zealanders  claim  for  themselves  and  their 
bank  now  the  best  position  in  the  Australasian  colonies,  and 
the  figures  bear  out  the  claim.  That  is  worth  a  great  deal 
of  money  to  the  country  and  is  bringing  in  a  great  deal  every 
year. 

The  colony  is  prospering  and  the  bank  will  share  in  all 
the  gains  of  the  community.  So  recuperative  is  democracy 


292     QUARANTINING  THE  PANIC  OF   1893 

— the  spirit  of  reciprocity  perpetually  fed  with  new  strength 
from  the  ever  renewed  youth  of  the  people.  If  the  debt  to 
the  Treasury  is  not  extinguished  in  1904,  when  its  advances 
fall  due,  it  will  be  an  easy  thing  to  arrange  an  extension. 

There  was  more  than  a  touch  of  justice  in  this  bank's 
coming  home  to  roost  with  the  government.  The  public 
works  policy  of  1870,  by  which  large  amounts  had  been 
borrowed  in  England  for  wholesale  construction  of  railroads 
and  other  public  improvements,  and  for  assisted  immigra- 
tion, had  had  much  to  do  with  inaugurating  the  era  of  spec- 
ulation which  had  demoralised  the  bank.  The  beginning 
of  its  unsoundness  was  found,  in  1894,  to  date  back  twenty 
years.  The  managers  had  been  tempted  into  reckless  bank- 
ing by  being  given  on  deposit  a  large  amount  of  this  bor- 
rowed money.  They  naturally  sought  to  find  employment 
for  these  deposits.  If  bank  managers  do  not  get  deposits 
they  are  dismissed;  if  they  get  deposits  and  do  not  loan 
them  they  are  dismissed;  if  they  loan  them  and  lose  them 
they  are  dismissed. 

The  state,  too,  had  practically  certified  the  bank  to  be  safe 
to  the  people  by  putting  its  money — their  money — on  de- 
posit with  it.  A  determined  colonial  treasurer  could  have 
kept  himself  posted  at  all  times  as  to  its  real  condition  or  he 
could  have  withdrawn  the  public  account. 

The  Ministry  through  its  bank  directors  comes  into  the 
most  intimate  connection  with  the  business  movements  of 
the  colony,  but  never  has  there  been  the  least  whisper,  in  the 
press,  or  on  the  platform,  or  in  Parliament,  that  any  im- 
proper use  has  been  made  of  this  power. 

The  last  time  the  bank  came  before  Parliament,  when,  in 
1896,  the  government  strengthened  its  representation  on  the 
board  of  directors,  one  of  the  most  influential  members  of 
Parliament,  and  one  of  the  best  known  citizens  of  New  Zea- 
land, the  Honourable  M.  S.  Grace — the  brother  of  Ex- 


NO   PALMS  GREASED  293 

Mayor  Grace  of  New  York — took  occasion,  in  words  which 
were  not  challenged,  to  declare  that,  throughout  the  whole 
affair,  there  had  been  absolutely  no  corruption,  political  or 
ministerial.  He  said : 

"It  is  probably  the  first  time  in  history  that  such  ex- 
traordinary and  complex  legislation,  involving  millions  of 
money,  has  been  affected  without  any  greasing  of  palms. 
What  would  such  an  operation  have  cost  in  London,  in 
Paris,  Berlin  or  Rome?  Any  person  who  has  had  any  op- 
portunity of  knowing  London  can  conceive  what  such  an 
operation  would  cost.  Whatever  our  follies — and  they  are 
of  a  transcendental  character — our  people  are  not  politically 
corrupt." 

There  can  be  no  doubt  that  the  plan  of  relief  by  the  Treas- 
ury advance  of  $10,000,000,  which  Parliament  was  so  per- 
emptorily called  on  to  make  "to-day,"  was  unnecessarily 
expensive.  The  proof  of  this  is  found  in  the  fact  that  the 
money,  when  advanced,  was  not  needed.  The  year  after 
the  advance  was  made,  in  1895,  tne  manager  of  the  bank 
wrote  to  Parliament  that  this  advance  of  $10,000,000  "had 
filled  the  bank's  coffers  with  money,  for  much  of  which 
either  no  employment  whatever  could  be  found,  or  only 
nominal  rates  could  be  obtained." 

Such  a  plethora  was  doubly  obnoxious  under  the  circum- 
stances. It  was  a  heavy  tax  on  the  people  and  a  renewed 
temptation  to  the  bank. 

A  "State  Bank"  had  been  suggested  in  New  Zealand  be- 
fore these  occurrences,  and  every  new  development  in  the 
affair  gave  texts  for  and  against.  The  sentiment  in  favour 
of  such  a  bank  is  not  as  strong  in  the  democracy  of  Aus- 
tralasia, perhaps,  as  it  is  in  that  of  Switzerland,  where  year 
before  last  it  received  a  large  vote;  but  there  is  in  both 
Australia  and  New  Zealand  a  large  constituency  for  such  a 
proposal. 


294     QUARANTINING  THE  PANIC  OF   1893 

One  of  the  most  prominent  business  men  in  the  colony 
said  in  Parliament,  in  opposing  the  first  advance  of  ten 
millions : 

"Long  before  we  are  done  with  this  bank  it  will  silence 
the  outcry  for  a  state  bank,  at  least  for  this  generation." 

But  by  another  member,  the  attempt  thus  to  use  this 
trying  experience  to  discourage  any  connection  of  the  state 
with  banking,  was  met  by  the  cogent  remark  that  the  trou- 
ble was  not  in  any  way  due  to  the  connection  of  the  state 
with  the  bank,  but  to  the  private  rascality  that  had  com- 
pelled the  state  to  interfere. 

"Private  banking  has  been  a  shame  and  a  scandal  all  over 
the  world,  and  has  brought  the  various  colonies  affected 
almost  to  ruin." 

This  member  hoped  never  to  see  the  day  when  the  Bank 
of  New  Zealand  would  be  again  managed  by  private  capi- 
talists. 

I  found  the  opinion  widespread,  among  the  best  informed, 
that  the  government  was  certain  to  be  compelled  to  continue 
to  keep  its  hand  in  the  management  of  the  bank,  beyond  the 
period  first  fixed  for  the  termination  of  its  guarantee — 1904. 

The  bank,  no  matter  how  well  it  may  do,  cannot  by  that 
time  repay  the  Treasury,  which  will  have  to  go  on  to  get 
its  money  back. 

One  plan  which  has  been  proposed  to  escape  the  evils  of 
political  management  is  that  the  state  should  put  the  bank 
under  the  charge  of  a  "non-political  board."  A  precedent 
in  point  is  furnished  by  South  Australia.  This  colony  has 
organised  its  state  mortgage  bank  in  precisely  this  way  to 
keep  it  out  of  politics.  It  is  managed  by  a  board  of  trus- 
tees, who  are  not  responsible  to  the  Ministry,  who  can  be 
removed  from  office  only  by  very  difficult  steps,  and  who, 
therefore,  can  act  independently  and  carry  on  the  bank  for 
strictly  commercial  interests.  But  this  device  is  not  a  pop- 


AN   APPALLING   POSSIBILITY  295 

ular  one  in  New  Zealand.  The  New  Zealander  is  a  polit- 
ical animal,  and  does  not  believe  in  confessing  bankruptcy 
by  making  assignments  of  his  political  powers  to  "non- 
political  boards." 

"Parliamentary  government  is  played  out,"  the  leader  of 
the  Opposition  exclaimed  in  debate  on  one  of  the  bills  far  the 
relief  of  the  bank — one  reorganising  the  management.  The 
house  had  been  then  sitting  for  twenty-three  hours  continu- 
ously on  this  measure.  It  was,  as  he  said,  utterly  exhausted. 
He  complained  that  Parliament  had  not  been  allowed  even 
a  few  hours  to  read  the  evidence  and  the  report  of  the  in- 
vestigating committee  on  which  the  bill  was  based,  and  was 
called  upon,  without  time  for  study  or  proper  debate,  to  pass 
the  proposed  law  at  one  sitting.  He  begged  for  an  adjourn- 
ment for  a  few  hours  that  the  house  might  be  able  to  qualify 
itself  to  decide  the  grave  and  important  question  involved  in 
the  bill  of  the  management  of  the  bank  in  which  the  Treas- 
ury now  had  a  liability  of  $26,000,000. 

This  request  the  Ministry,  for  reasons  it  thought  suffi- 
cient, refused  to  grant,  and  the  bill  was  passed  by  the  house 
after  a  sitting  of  twenty-four  hours  at  two  o'clock  in  the 
morning,  but  failed  in  the  other  house. 

The  first  legislation  for  $10,000,000  was  put  through  in 
one  night.  An  attempt  was  made  to  push  the  second  pledge 
of  $17,000,000  in  the  same  way,  but  the  protests  of  the 
members  finally  secured  a  week's  time. 

There  is  an  appalling  intimation  here  of  the  possibilities 
of  Parliamentary  government,  especially  in  view  of  the  in- 
creasing tendency  to  add  commercial  and  economic  functions 
to  political  duties ;  that  is,  to  go  into  business,  or  to  control 
business.  The  power  that  Parliament  forges  is  the  mighti- 
est known  to  man.  No  citizen  so  humble  or  so  far  away  as 
to  escape ;  no  one  so  strong  that  he  can  resist.  A  few  words 
put  after  the  magic  formula  "Be  It  Enacted,"  and  the  prop- 


296     QUARANTINING  THE  PANIC  OF   1893 

erty,  welfare  and  morals  of  millions  suffer  change  for  good 
or  bad  over  continents,  and  a  mortgage  is  fastened  on  the 
happiness  and  the  energies  of  unborn  generations. 

Evidently  as  democracy  grows  more  powerful  and  "the 
people"  comes  nearer,  our  present  Parliamentary  methods 
must  give  way  to  something  less  impulsive,  something  less 
like  weather  and  more  like  growth.      • 

One  of  the  greatest  disasters  the  world  has  ever  seen 
awaits  the  people  who  attempt  to  administer  enterprise  on 
socialistic  principles  through  present  Parliamentary  methods. 
It  would  break  down  as  no  other  civilisation  has  broken 
down  before.  All  that  a  co-operative  society  is,  Par- 
liamentary government  is  not  in  the  administration  of 
business. 

Banks,  railroads,  mines,  insurance,  manufacturing,  "state 
theatres,"  "municipal  restaurants"  cannot  be  run  by  mass 
meetings,  stump  speakers,  caucuses  and  ministerial  pull — no 
more  than  private  banks  and  business  can  be  so  run.  What 
we  know  as  "politics"  and  socialism  are  incompatible.  De- 
mocracy itself  will  see  that  democratic  industry  must  not  be 
at  the  daily  mercy  of  majorities  of  one  and  of  "all-night" 
sessions,  nor  of  officials  appointed  to  please  politicians. 

Perhaps  the  school  will  take  the  place  of  the  nominating 
convention.  With  public  schools  and  colleges  as  the  gates 
to  all  public  industries,  aptitude  instead  of  office-seeking 
will  determine  the  choice  of  vocation,  examinations  instead 
of  influence  will  give  the  appointment,  and  performance  in- 
stead of  pull  will  give  promotion.  We  shall  have  selection 
instead  of  election;  processes  working  with  the  steadiness 
of  nature's  laws  instead  of  waves  of  popular  feeling  which 
defeat  in  the  long  run  the  popular  will. 

A  happy  combination  of  circumstances  like  that  in  New 
Zealand  where  the  country  was  young,  the  people  honest, 
and  the  "general  good"  still  a  slogan,  may  make  such  an 


BREAKING  BANKS,  BREAKING  HEARTS    297 

episode  as  we  have  described  in  this  chapter  a  success,  but 
it  would  be  folly  not  to  see  that  the  success  was  a  "fluke,"and 
that  to  count  upon  it  would  be  to  make  it  impossible  again. 
A  special  providence  watches  over  children,  fools  and  de- 
mocracies until  they  count  on  it. 

But,  though  a  fluke,  the  success  of  the  New  Zealand  anti- 
panic  remedy  in  this  incident  is  incontestable.  There  was 
no  run  on  the  Bank  of  New  Zealand,  no  bank  in  the  country 
had  to  close  its  doors,  in  New  Zealand  alone  there  was  no 
panic.  The  financial  wind  there  did  not  blow  where  it 
listed.  The  New  Zealand  Canute  said  to  the  commercial 
sea  of  troubles  floating  in  everywhere  else,  "Thus  far  and 
no  farther,"  and  it  stayed.  In  every  other  centre  of  finan- 
cial civilisation  thousands  of  people's  hearts  broke  as  they 
stood  in  line  before  the  doors  of  breaking  banks. 

A  comparison  of  the  statistics  of  the  three  principal  col- 
onies of  Australasia  tells  the  story : 

BEFORE  AND   AFTER   THE   PANIC 


New  South  Wales, 

Victoria, 

New  Zealand, 

New  South  Wales, 

Victoria, 

New  Zealand, 

New  South  Wales, 

Victoria, 

New  Zealand, 

New  South  Wales, 

Victoria, 

New  Zealand, 


BANKING  DEPOSITS 
1891  1897 

£42,988,550       £40,114,033 
50,183,551          37,742473 
17497,436          I9,958,78i 
IMPORTS 

£25,383.397       £21,744,350 

21,711,608          15,456,482 

6,503,849  8,055,223 

EXPORTS 

£25,944,020  £23,751,072 
16,006,743  16,739,670 
9,566,397  10,016,993 

PUBLIC  REVENUE 

£10,036,185  £9,304,249 
8,343,588  6,887463 

4,I93»942  5,079,230 


Gain 


Loss 

£  2,874,517 
12,441,078 


6,255,126 

£1,551,374 

£2,192,948 

£732,927 

450,596 

£885,288 


£  731.936 
1,546,125 


298     QUARANTINING  THE  PANIC  OF   1893 

In  bank  deposits,  in  the  totals  of  trade  in  and  out,  and  in 
the  revenue  payable  by  the  people,  between  1891  before  the 
panic  and  1897  after  the  panic,  New  Zealand  alone  shows  a 
gain,  with  the  exception  of  the  exports  of  Victoria.  New 
South  Wales  and  Victoria  fell  backward. 

This  fact,  that  there  was  no  panic  in  1893  in  New  Zea- 
land, must  take  its  place  with  the  other  fact  we  have  chron- 
icled that,  owing  to  the  compulsory  arbitration  law,  there 
has  not  been  a  strike  or  lock-out  in  New  Zealand  for  five 
years,  as  two  of  the  most  remarkable  achievements  in  the 
history  of  this  remarkable  country. 


CHAPTER  XII 
"AND  THEN  WE  SMASHED  THE  MONEY  RING" 

ITS  Advances  to  Settlers  is  the  most  characteristic  feature  of 
New  Zealand's  aid  to  industry.  This  began  as  a  policy  of 
Treasury  loans  to  farmers  on  their  land.  It  was  initiated 
in  1893,  and  has  since  been  imitated  by  New  South  Wales, 
Victoria  and  South  Australia. 

The  world  over  one  of  the  greatest  obstacles  in  the  way 
of  the  small  farmer — and  the  large  one — is  the  difficulty 
of  getting  capital.  Often  there  is  no  money  to  be  bor- 
rowed in  the  district  where  he  lives,  or,  if  there  is,  it  is 
in  the  hands  of  rich  neighbours  or  banks,  who  know  noth- 
ing but  their  bond  and  the  pound  of  flesh.  But  in  New 
Zealand  the  settler  has  only  to  go  to  the  nearest  post-office 
to  get  into  communication  with  a  money-lender  who  charges 
no  commission  or  brokerage,  and  no  fees,  except  for  actual 
expenses,  never  exacts  usury,  offers  no  cut-throat  mortgages 
for  signature,  .will  let  him  have  any  amount  from  as  little 
as  $125  to  as  much  as  $15,000,  has  never  foreclosed,  does 
not  try  to  induce  him  to  borrow  more  than  he  really  needs, 
if  he  has  no  freehold  will  lend  on  leasehold  and  good- 
will and  improvements,  gives  him  thirty-seven  and  a  half 
years  to  pay  the  money  back,  and  accepts  it  from  him  in 
small  instalments  of  principal  with  every  payment  of  inter- 
est, so  as  to  make  it  as  little  of  a  burden  as  can  be,  will  allow 
him,  if  he  happens  to  have  $25  to  spare,  to  pay  it  in  at  any 
time  to  reduce  his  indebtedness,  and  when  it  finds  itself  mak- 

299 


300  THEN  WE  SMASHED  THE  MONEY  RING 

ing  a  profit  out  of  its  business,  instead  of  accumulating  a 
fortune,  gives  him  the  benefit  by  reducing  his  rate. 

When  the  New  Zealand  farmer  goes  to  the  post-office  for 
his  mail  there  faces  him  on  the  walls  this  notice: 

ADVANCES  TO   SETTLERS 

THE  GOVERNMENT  ADVANCES  TO  SETTLERS  OFFICE 
HAS  MONEY  TO  LEND 

Upon  Fixed  or  Instalment  Mortgages  in  Sums  of  from 
to 


On  Freehold  or  Ground  Leasehold,  for  use  for  Agricul- 
tural, Pastoral,  Dairying,  or  Market-Gardening  Purposes. 

Borrowers  have  the  Right  to  Repay  the  loans  Partly  or 

Wholly 

AT  ANY  TIME. 

Fixed  Loans  are  Granted  upon  Freeholds  for  any  Term 
not  Exceeding  Five  Years,  and  Instalment  Loans 

FOR     6       YEARS: 


Interest  Five  Per  Cent,  with  (in  the  case  of  Instalment 
Mortgages)  an  Additional  One  Per  Cent,  on  Account  of  the 
Repayment  of  Principal. 

All  Costs  very  Low.  No  Commission  or  Brokerage  Fees 
Charged. 

This  is  the  notice  the  South  Australian  farmer  finds  at 
his  post-office: 

SOUTH  AUSTRALIA 


On  approved  securities  at  FOUR  AND  A  HALF  per  cent,  per 
annum,  repayable  by  equal  half-yearly  instalments  on  April 
i  and  October  i,  extending  over  periods  of  from  ONE 


IF  HE  WANTS  THE  MONEY  301 

to  FORTY-TWO  years.  Borrowers  have  the  privilege  of 
paying  off  ANY  PORTION  or  the  WHOLE  of  the  PRINCIPAL, 
should  they  so  desire,  ON  ANY  ist  of  APRIL  or  ist  of 
OCTOBER,  and  when  any  portion  of  principal  is  paid  off, 
the  INTEREST  is  REDUCED  PROPORTIONATELY. 

Each  half-yearly  instalment  contains  a  PORTION  OF  THE 
PRINCIPAL,  so  that,  at  the  expiration  of  the  period  for  which 
the  loan  is  granted,  THE  WHOLE  SUM  is  PAID  OFF  and 
the  borrower  is  entitled  to  the  discharge  of  his  mortgage. 

No  CHARGE  is  MADE  for  EITHER  PREPARATION  or 
DISCHARGE  of  MORTGAGE,  the  ENTIRE  COST  to  the  bor- 
rower being  the  fees  for  registration. 

Applications  to  be  made  to  Mr.  G.  S.  Wright,  the  In- 
spector-General of  the  State  Bank,  from  whom  further 
information  may  be  obtained. 

South  Australia  does  a  little  better  with  its  State  Bank 
than  New  Zealand.  New  Zealand  charges  its  borrowers 
five  per  cent.  South  Australia  offers  money  at  four  and  one 
half  per  cent.,  and  makes  no  charge  for  either  the  prepara- 
tion or  discharge  of  the  mortgage. 

If  our  farmer  needs  some  money  the  clerk  at  the  window 
will  give  him  a  printed  form  on  which  to  write  his  appli- 
cation. In  reply  he  will  perhaps  receive  a  note  like  the  fol- 
lowing, which  is  a  copy  of  one  of  the  forms  used  by  the 
State  Bank  of  South  Australia: 

THE  STATE   BANK   OF  SOUTH   AUSTRALIA 

Adelaide, 189 

SIR:  I  have  to  inform  you  that  it  is  very  unlikely  that 
the  amount  asked  for  in  your  application  would  be  granted ; 
and  to  avoid  putting  you  to  unnecessary  expense  I  shall  be 
glad,  before  asking  you  for  a  valuation  fee,  if  you  will  in- 


302  THEN  WE  SMASHED  THE  MONEY  RING 

form  me  what  is  the  least  possible  amount  that  will  answer 
your  purpose,  and  what  you  require  the  money  for. 
Yours  faithfully, 

G.  S.  WRIGHT,  Inspector-General. 

Mr. 


Or  perhaps  his  application  is  looked  upon  more  favour- 
ably, and  he  gets  this  answer : 

THE   STATE    BANK   OF   SOUTH   AUSTRALIA 

Adelaide, 189 

SIR  :  I  have  to  inform  you  that  the  Trustees  of  the  State 
Bank  have  approved  of  a  loan  of  ....  on  the  security 
offered  in  your  application,  which  will  be  available  on  the 
due  execution  of  a  first  mortgage  of  the  security  offered. 

To  avoid  delay,  please  advise  when  a  settlement  is  likely 
to  take  place,  so  that  a  check  may  be  in  readiness. 
I  am,  sir, 

Yours  obediently, 

G.  S.  WRIGHT,  Inspector- General. 
Mr 

If  the  loan  is  made  the  New  Zealand  or  South  Australian 
farmer  receives  his  money  through  the  post-office ;  he  makes 
his  interest  payments  there ;  the  whole  transaction  is  made  as 
easy  and  simple  for  him  as  possible. 

When  the  decline  of  prices  began  in  1893,  after  the  panic 
which  ravaged  every  country  but  New  Zealand,  the  Aus- 
tralasian farmer  had  to  sell  in  the  world's  market  his  butter, 
grain  and  meat  at  steadily  falling  prices,  but  the  mortgage 
companies  and  banks  would  not  lower  their  rate  of  interest 
on  the  money  he  had  borrowed,  nor  would  they  make  fresh 


THE   FARMER   BETHOUGHT   HIMSELF    303 

loans  at  rates  which  corresponded  to  the  universal  shrink- 
age. They  thought  they  had  the  advantage  of  position,  and 
naturally  they  meant  to  make  the  most  of  it. 

Whereupon  the  New  Zealand  farmer  bethought  himself 
of  an  advantage  of  position  he  had.  He  had  the  govern- 
ment, or,  more  accurately,  he  was  the  government,  and  its 
power  he  knew  well  by  previous  experience.  He  was  demo- 
cratic enough  to  believe  that  that  power  is  never  put  to 
better  use  by  the  people  than  to  increase  the  welfare  of 
the  people.  The  people  pay  the  bills;  they  have  the  right 
to  the  benefit.  The  New  Zealand  democrat  saw  that  he 
could  use  his  power  as  a  citizen  to  obtain  for  himself  as 
an  individual  the  advantage  of  the  low  rates  at  which  gov- 
ernment can  get  money.  Thereupon  he — that  is,  his  Par- 
liament— passed  a  law  directing  the  Treasurer  to  borrow 
$15,000,000  on  bonds  in  London  and  loan  the  money  so 
obtained  to  the  farmers,  market-gardeners  and  cattle  men 
of  the  colony  at  enough  of  an  advance  to  pay  the  expenses 
and  accumulate  a  reserve  fund  for  bad  debts.  As  the  Treas- 
ury of  the  nation  could  borrow  money  in  London,  in  the 
international  money  market,  at  three  to  four  per  cent. — the 
price  realised  for  the  three  per  cent,  consols  sold  in  this 
case  was  £94  8s.  gd.  for  one  hundred — it  could  loan  it  at 
five  per  cent,  and  make  a  handsome  profit. 

The  New  Zealand  farmer  is  a  very  practical  man.  He 
enjoys  being  addressed  at  country  fairs  and  political  mass 
meetings  as  a  "bulwark"  and  "mainstay,"  and  "bone  and 
sinew"  and  all  that,  but  he  also  likes  to  see  some  substantial 
benefits  accompanying  these  honeyed  words. 

In  this  case  he  did  not  take  long  to  decide  what  to  do, 
nor  how  to  do  it.  The  decline  in  prices  began  in  the  years 
immediately  preceding  1893.  The  Advances  to  Settlers 
law  was  passed  in  1894,  and  the  money  was  in  hand  in 
May,  1895.  The  preamble  of  the  act  read: 


304  THEN  WE  SMASHED  THE  MONEY  RING 

'Whereas,  by  reason  of  the  high  rates  of  interest  charged 
on  the  mortgage  of  land,  and  the  heavy  incidental  expenses 
connected  therewith,  settlers  are  heavily  burdened  and  the 
progress  of  the  colony  is  much  retarded,  and 

'Whereas,  it  is  expedient  that  the  government  should 
afford  such  relief  in  the  premises  as  is  consistent  with  the 
public  safety, 

"BE  IT  ENACTED,"  etc. 

Seven  million  five  hundred  thousand  dollars  were  bor- 
rowed at  first,  and  $2,500,000  more  have  been  borrowed 
since — $10,000,000  in  all. 

The  Conservatives  opposed  this  project  with  unanswer- 
able demonstrations  that  it  must  be  futile,  since  the  rate 
of  interest  is  fixed  by  the  "law  of  the  market,"  and  that 
government,  which  can  "create  nothing,"  can  no  more  in- 
terfere with  these  laws  than  with  the  laws  of  the  tides. 
But  the  result  has  proved  that  in  New  Zealand  part  of  the 
"law  of  the  market"  is  that  the  New  Zealanders  as  a  gov- 
ernment can  borrow  money  in  London  at  three  or  four  per 
cent,  and  then  lend  it  to  themselves  at  four  or  five  per  cent. 

By  an  amendment  of  the  law  in  1899,  the  owners  of  city 
and  suburban  property,  at  first  excluded,  are  allowed  to 
borrow  this  "cheap  money"  under  certain  limitations.  It 
is  recognised  that  the  industries  of  the  towns  are  handi- 
capped by  usury  as  well  as  those  of  the  country. 

The  business  which  has  been  done  under  the  act  is  shown 
in  the  following  statement  furnished  me  by  the  officials : 

GOVERNMENT  ADVANCES  TO  SETTLERS  OFFICE, 
NEW  ZEALAND 

Number  of  applications  received  up 

to  January  31,  1899 8778 

Amounting   to £2,881,316 


WHO   WERE   FURIOUS  305 

Number  of  applications  on  which,  up 
to  January  31,  1899,  advances 
were  authorised 683 1 

Amounting   to £1,994,115 

Number  of  advances  authorised 
which  were  declined  by  applicants, 
up  to  January  31,  1899 808 

Amounting   to £369,295 

Balance,  being  amount  of  advances 
authorised  to  and  accepted  by  ap- 
plicants (to  number  of  6023)  . . .  £1,624,820 

NOTE. — The  amount  authorised  to  and  accepted  by  ap- 
plicants (£1,624,820)  includes  mortgages  repaid  and  rein- 
vested on  mortgage. 

In  April,  1900,  the  office  announced  that  the  number  of 
loans  had  increased  to  over  7000,  "and  we  have  not  lost 
one  shilling.  For  the  year  there  is  not  one  penny  of  prin- 
cipal or  interest  uncollected."  The  amount  advanced  by 
the  department  has  been  $10,000,000.  The  government 
supporters  could  well  afford  to  ask  in  the  last  campaign : 
Where  could  the  loan  company  be  found  that  could  show 
such  a  record  as  that  ? 

The  State  Bank  of  South  Australia  has  so  far  loaned 
$1,862,600,  and  the  amount  of  interest  in  arrears,  March 
31,  1898,  on  the  transactions  of  several  years  was  only  $472. 

The  citizens  who  voted  for  this  to  help  the  farmer  got 
their  own  reward  in  a  general  reduction  of  their  rates  of 
interest  and  in  a  new  prosperity.  All  over  the  colony  rates 
came  down  with  a  run ;  not  only  the  government  borrowers 
but  all  the  borrowers  felt  the  benefit.  A  small  group  of 
capitalists  were  furious  of  course,  but  it  is  not  this  class 
which  controls  the  administration  of  New  Zealand. 


306  THEN  WE  SMASHED  THE  MONEY  RING 

The  people  have  done  more  than  make  money  by  this 
financial  "self-help."  They  have  released  themselves  from 
a  degrading  servitude  to  the  money-lenders.  "They  used 
to  have  to  go,"  the  Honourable  J.  G.  Ward  has  said,  "with 
their  hats  in  their  hands,  and  beg  and  beseech  the  few  who 
had  control  of  money  before  they  could  get  it;  they  had  to 
pay  an  extravagant  rate  of  interest;  not  infrequently  they 
were  compelled  to  do  their  trading  with  the  institution 
from  which  they  got  a  loan.  Now  borrowers  are  sought 
after  if  their  security  is  good,  their  rate  of  interest  is  low, 
and  they  are  relieved  of  the  despicable  compulsion  to  deal 
with  a  business  concern  because  they  have  secured  a  loan 
through  it.  The  farmer  now  can  sell  his  produce  where  he 
pleases." 

A  high  official,  one  who  has  had  a  potent  hand  in  this 
legislation  and  all  the  other  recent  progressive  movements, 
gave  a  breezy  explanation  of  the  land  and  money  legisla- 
tion of  1892  and  1894: 

"We  smashed  the  land  ring  by  the  land  and  income 
tax  laws  and  by  our  land  for  settlement  laws,  and  then 
we  smashed  the  money  ring  by  state  lending.  The  two 
rings  worked  in  with  each  other.  The  action  of  the  state 
in  entering  the  money  market  has  made  an  average  re- 
duction of  two  per  cent,  on  £32,000,000  of  landed  indebt- 
edness, and  £32,000,000  of  other  debts.  This  is  a  saving- 
of  £1,200,000  a  year  to  the  country.  In  other  words,  the 
London  loan  of  £2,000^000,  which,  at  three  per  cent.,  costs 
the  country  £60,000  a  year,  is  costing  the  people  really  less 
than  nothing.  There  is  a  vast  saving  going  into  their  pock- 
ets every  year  in  greater  comfort,  independence  and  hope." 

Here  is  a  political  economy  which  creates  wealth  by  capi- 
talising political  brotherhood. 

The  official  statement  of  the  purposes  of  the  law,  in  the 
New  Zealand  Year  Book  for  1899,  speaks  with  almost  equal 


NOT   RULED   BY   MONEYED   MEN        307 

plainness.  Referring  to  the  general  decline  caused  by  the 
advances  to  settlers  in  the  rates  of  interest  throughout  the 
colony  the  Year  Book  says: 

"This  result,  while  it  may  have  diminished  the  incomes 
of  a  few  persons  resident  within  the  colony  has  benefited 
thousands  of  deserving  settlers  and  led  to  large  areas  of 
land  being  brought  under  cultivation  that,  but  for  the  Ad- 
vances to  Settlers  Act,  would  still  be  in  their  natural  state." 

"You  would  be  surprised,"  a  prominent  member  of  the 
Ministry  said,  "at  the  small  power  of  the  moneyed  men 
in  this  country.  They  can  never  get  possession  of  the  rail- 
roads nor  telegraphs.  The  government  competes  with  them 
in  the  rates  of  interest.  They  see  the  borrowers  who  need 
to  come  to  them  growing  fewer.  They  do  not  dare  to 
build  up  large  estates." 

The  Premier  of  South  Australia,  too,  in  his  annual 
speech  to  the  people,  in  1896,  emphasises  the  fact  that  the 
State  Bank  has  forced  capitalists,  rather  than  lose  their  busi- 
ness, to  "reduce  their  rates  in  a  way  that  would  not  have 
been  dreamed  of  but  for  this  competition,"  and,  he  adds, 
"a  good  thing,  too,"  with  cheers  from  his  audience. 

The  rate  of  interest  charged  on  the  advances  to  set- 
tlers is  five  per  cent,  a  year,  but  the  amount  paid  each  six 
months  is  at  the  rate  of  six  per  cent.  The  extra  one  per 
cent,  is  repayment  of  principal.  There  are  seventy-three 
semi-annual  payments,  so  that  the  whole  debt  is  cleared  off 
in  thirty-six  and  one  half  years.  On  a  loan  of  $500  the 
borrower  pays  $15  every  six  months  for  thirty-six  years. 
The  last  payment  is  $9. 

On  freehold  property  sixty  per  cent.,  on  leasehold  prop- 
erty fifty  per  cent,  will  be  loaned  by  the  state.  Whenever 
a  farmer  has  $25  "to  the  good"  in  his  pocket  it  will  be  ac~ 
cepted  in  reduction  of  his  indebtedness,  and  he  may  pay  off 
the  whole  at  any  time.  The  charges  for  examining  the 


308  THEN  WE  SMASHED  THE  MONEY  RING 

property  and  preparing  the  papers  are  all  regulated  by  a 
fixed  schedule,  and  are  most  moderate.  No  person  in  the 
Advances  to  Settlers  office  is  allowed  to  take  any  fee  or 
reward  from  any  one  seeking  a  loan.  The  average  amount 
loaned  is  under  $1500.  A  considerable  number  of  the  bor- 
rowers pay  before  the  money  is  due.  Ninety  per  cent,  pay 
within  a  fortnight.  Two  thirds  of  the  borrowers  wanted 
the  money  to  pay  off  existing  mortgages  made  with  private 
parties  at  high  rates.  Absolute  secrecy  is  guaranteed  the 
borrower. 

New  Zealand  went  to  the  London  market  for  its  money, 
but  the  manager  of  the  South  Australian  bank  informed  me 
that  he  got  all  his  funds  at  home.  He  disposes  of  his 
bonds  largely  to  savings  banks  and  insurance  companies. 
He  sells  his  three  and  one  half  per  cent,  bonds  in  Adelaide 
at  a  premium  and  lends  the  money  to  the  farmers  at  four 
and  one  half  per  cent.  He  saves  by  this  use  of  home  capi- 
tal a  considerable  amount  of  interest  money  which  in  the 
case  of  New  Zealand  was  wasted  from  the  fact  that  the 
Treasury,  after  selling  its  bonds  in  the  London  market,  was 
not  ready  for  some  time  to  use  the  proceeds,  and  these  con- 
sequently lay  idle.  The  advantage  of  the  South  Australian 
method  is  that  the  State  Bank,  when  an  application  is  ap- 
proved, say  to-day,  sells  the  bonds  to-morrow,  and  can  pay 
over  the  money  to  the  borrower  the  next  day. 

The  operation  of  the  New  Zealand  act  has  been  so  suc- 
cessful that  the  rate  of  interest  is  to  be  reduced.  In  his 
budget  speech  for  1899  Premier  Secldon,  after  showing  that 
on  the  last  $2,500,000  borrowed  in  London  for  advances 
to  settlers  the  earnings  were  $125,000  a  year,  although  the 
money  cost  only  $75,000  a  year,  gave  notice  that  he  pro- 
posed to  allow  the  people  the  advantage  of  this  profit,  and 
"reduce  by  one  half  per  cent,  per  annum  the  interest  charged 
upon  advances  to  settlers." 


CHAPTER  XIII 

GOVERNMENT    AND    COMPANY,    UNLIMITED 

ALL  the  Australasian  commonwealths  are  zealous  seconds 
of  their  people  in  the  international  duels  of  the  market. 
When  the  producer  of  Australia  goes  to  Europe  to  sell  his 
meats,  wine,  or  wheat,  in  competition  with  all  the  other  pro- 
ducers who  rendezvous  there,  he  has  his  country  behind  him 
— and  before  him,  too,  since  it  is  awaiting  his  arrival,  and 
has,  in  most  cases,  even  instructed  him  in  advance  what  to 
bring  and  how  to  raise  it,  and,  as  will  appear,  does  even  more 
than  this. 

The  butter  market  of  London  is  a  colosseum  of  competition 
where,  behind  the  individual  sellers  from  Denmark,  Canada, 
New  Zealand,  Victoria,  the  United  States  and  France,  are 
to  be  seen  the  governments  to  which  they  belong  urging 
them  on,  telling  them  how  to  strike,  and  refreshing  them 
between  the  rounds. 

The  United  States  Agricultural  Department  in  1898 
issued  501  different  pamphlets  and  gave  them  a  circulation 
of  over  7,000,000  copies.  The  country  that  does  the  least 
for  its  producers  is  the  one  whose  farmers  are  being  most 
completely  competed  out  of  their  own  market — England. 
No  home  market  is  enough  for  any  community  in  these 
days  of  "expansion." 

All  the  Australasian  colonies  are  committed  to  the  policy 
of  backing  up  the  industries  of  their  people  at  home  and  in 
the  foreign  markets.  Queensland  has  advanced  money  to 

3°9 


310        GOVERNMENT  &  CO,  UNLIMITED 

build  co-operative  sugar-mills ;  South  Australia  has  its  Lon- 
don export  depot  and  state  bank;  Victoria  receives,  grades 
and  ships  fruit,  butter,  rabbits,  tobacco  and  other  things, 
and  has  a  very  generous  system  of  bonuses.  Boldest  of 
all  is  the  "cheap  money"  scheme  of  New  Zealand.  New 
South  Wales  does  less  than  any  other  colony.  It  is  more 
like  England  in  its  "let  alone"  ideas.  But  in  the  dry  lands 
it  is  digging  wells  to  supply  the  farmer  with  "cheap  water," 
which  is  to  him  quite  as  important  as  "cheap  money"  to 
the  well-watered  New  Zealander.  All  the  colonies  subsi- 
dise the  miner  and  prospector  or  "fossicker." 

Queensland  gives  a  bounty  on  home-sold  wool  if  home 
grown,  and  has  two  travelling  dairies  going  about  the  col- 
ony for  the  instruction  of  farmers.  But  most  important 
is  the  part  it  takes  in  the  battle  of  the  nations  in  the  world's 
sugar  markets.  In  proportion  to  its  population  of  only 
500,000,  this  country's  re-inforcement  of  its  sugar  pro- 
ducers has  been  the  most  generous  of  all.  In  1885  the 
Queensland  Parliament  appropriated  $250,000  to  be  ad- 
vanced for  the  building  of  sugar-mills  for  associations  of 
growers  who  had  no  mills  in  their  vicinity  and  no  means  to 
build  for  themselves. 

One  of  the  purposes  of  this  legislation  was  to  help  in  the 
solution  of  the  great  economic  problem  of  Queensland — 
whether  sugar  can  be  grown  there  as  it  is  in  New  South 
Wales  by  white  labour  alone.  It  was  made  a  condition  of 
the  loans  that  only  white  men  should  be  employed. 

In  the  first  years  the  experiment  was  not  very  successful. 
The  co-operators  got  into  trouble  among  themselves,  and 
their  irritation  against  the  management  was  so  great  in  some 
cases  that  the  members  boycotted  their  own  mills.  The 
associations  did  not  pay  their  interest  to  the  Treasury,  and, 
in  defiance  of  the  express  stipulation  of  the  law,  they  crushed 
cane  grown  by  black  labour. 


STATE  SUGAR  MILLS  311 

Still,  in  1893,  enough  had  been  accomplished  in  the  opin- 
ion of  Parliament  to  call  for  a  wider  effort.  A  new  law, 
the  Sugar  Works  Guarantee  Act,  was  passed  appropriating 
$2,500,000  for  the  erection  of  sugar-mills,  and  in  September, 
1899,  the  Minister  of  Agriculture  declared  himself  to  be 
in  favour  of  a  further  appropriation  of  $2,500,000. 

The  state  derives  large  benefits  from  this  policy.  I 
found  that  it  had  been  the  means  of  settling  hundreds  of 
people  on  land  in  districts  where  only  dozens  were  before; 
and  this  process  of  settlement  is  still  going  on.  This  in- 
creases the  amount  of  taxable  property,  the  growth  of  popu- 
lation and  the  business  of  the  railroads,  all  of  which  adds 
to  the  revenue. 

The  policy  has  been  popular  with  the  farmers  because  there 
are  a  hundred  and  one  contracts  of  all  kinds  for  them  and 
their  teams,  in  connection  with  building  and  operating  the 
mills.  It  has  been  popular  with  the  labouring  men  and  the 
radicals  because  of  its  co-operative  feature,  and  because 
they  saw  in  the  development  of  co-operative  sugar  planting 
a  re-enforcement  of  their  campaign  against  imported  col- 
oured labour.  Some  of  the  large  banks  and  landowners 
favour  it  because  it  increases  the  saleability  of  land. 

Any  group  of  Queensland  farmers  who  wish  to  go  into 
sugar-cane  culture,  and  are  not  within  reach  of  a  mill  where 
they  can  market  their  cane,  need  only  get  together  and  for- 
ward an  application,  asking  that  an  official  be  sent  to  inves- 
tigate and  report.  If  he  finds  that  their  land  is  suitable  and 
that  there  is  enough  of  it,  and  that  the  farmers  know  their 
business  and  mean  business,  the  project  is  sanctioned.  The 
farmers  must  give  their  guarantee  that  the  land  will  be  kept 
in  cultivation  to  a  sufficient  extent  to  provide  employment 
for  the  mill. 

The  planters  then  incorporate  themselves  and  make  appli- 
cation in  legal  form  for  the  needed  amount  of  money.  The 


312         GOVERNMENT  &  CO.,  UNLIMITED 

plans  of  their  mill  must  be  submitted  for  official  approval, 
and  when  this  has  been  had,  their  lands  and  the  mill  to  be 
erected  are  turned  over  to  the  government  under  a  mort- 
gage and  bill  of  sale.  On  this  security  the  Treasury  ad- 
vances the  money,  not  giving  it  over  direct  to  the  associa- 
tion, but  using  it  to  pay  for  their  mill.  The  construction  is 
superintended  by  a  state  official,  and  "progress  payments" 
are  made  only  upon  his  certificate.  While  all  these  prelim- 
inaries of  organisation,  issue  of  debentures  and  building 
of  the  mill  are  going  on,  the  farmers  are  clearing  and  plant- 
ing their  ground.  The  Treasury  at  first  undertook  simply 
to  guarantee  the  bonds  of  these  companies  at  three  and  one 
half  per  cent.,  but  in  practice  from  the  beginning,  and  now 
by  law,  takes  the  debentures  itself  and  advances  the  cash. 

The  latest  returns,  those  for  1899,  show  eleven  mills  to 
have  been  built  under  this  plan.  They  have  received  ad- 
vances of  $2,324,805  out  of  the  authorised  appropriation  of 
$2,500,000.  They  have  a  capacity  of  48,000  tons  of  sugar 
in  the  season.  The  total  product  of  the  colony  last  year 
was  163,734  tons.  They  have  made  a  net  profit  of  $95,280; 
have  paid  interest  of  $101,770,  and  up  to  June  30,  1899, 
owed  $182,225  in  interest,  and  $281,300  on  the  repayments 
which  according  to  law  were  to  be  made  each  year  in  "re- 
demption" of  the  principal. 

The  percentage  of  profit  earned  by  these  mills  varied  from 
three  and  one  half  per  cent,  to  twenty-two  and  one  half  per 
cent.,  the  average  being  nine  and  one  quarter  per  cent.  In 
mitigation  of  the  failure  of  the  mills  to  pay  all  of  the  in- 
terest they  owe,  they  plead  the  fact  of  a  very  heavy  fall  in 
the  price  of  sugar  and  a  succession  for  three  years  of  bad 
seasons. 

•  A  hot  controversy  rages  around  the  question  of  white 
against  black  labour.  One  of  the  effects  of  federation  will 
be  to  put  an  end  to  the  use  of  Kanaka  or  coolie  labour  on  the 


THE  WHITE  MAN'S  PRIVILEGE          313 

sugar  plantations  of  Queensland.  New  South  Wales  raises 
its  sugar  with  white  labour,  and  will  never  consent  that 
Queensland  shall  have  the  advantage  of  the  cheaper 
labour  from  the  South  S^a  Islands — if  it  is  cheaper.  On 
the  other  hand,  in  federation  Queensland  will  get  the  benefit 
of  a  protective  duty  against  foreign  sugars.  This  will 
inure  wholly  to  its  advantage,  as  it  alone  of  the  colonies 
produces  more  sugar  than  it  consumes.  The  intense  "white" 
policy  of  Australian  labour  parties  will  make  it  impossible 
for  Queensland  to  continue,  now  that  federation  has  come, 
her  importation  of  the  Kanakas  and  coolies.  Even  before 
federation  and  without  the  help  of  the  Labour  Party  in  the 
other  colonies,  the  Labour  Party  of  Queensland  has  been 
able  to  impose  so  many  restrictions  on  this  black  labour  as 
to  take  away  a  very  large  part  of  the  profit  of  it.  Mr. 
Michael  Davitt  has  given  some  very  interesting  and  accurate 
details  in  his  book  about  this  labour  situation  in  Queens- 
land. 

The  official  returns  show  cases  in  which  "free"  Kanakas 
receive  $750  a  year.  Many  draw  from  $3.75  to  $6.25  a 
week,  with  housing  and  rations.  They  receive  all  this 
whether  well  or  sick,  and  if  sick,  must  be  given  proper  medi- 
cal attention.  The  black  man  is  not  allowed  to  plough  nor 
drive  a  horse  on  the  road,  nor  to  work  in  the  mills.  This 
work  is  the  privilege  of  the  white  man. 

I  found  the  officials  of  the  Agricultural  Department  at 
Brisbane  believers  in  the  feasibility  of  cultivating  the  cane 
fields  with  white  labour.  They  told  me  that  the  small 
planters  who  are  going  into  these  co-operative  mills  by  the 
help  of  public  money  are  cultivating  their  cane  fields  with 
their  own  and  other  white  labour.  They  employ  a  few 
black  men,  but  this  black  labour  is  decreasing,  and  it  is 
thought  will  continue  to  decrease.  The  supply  is  small, 
and  the  black  man  is  rapidly  becoming  sophisticated  enough 


314        GOVERNMENT  &  CO.,  UNLIMITED 

to  get  as  much  as  the  white  man,  and  is,  at  the  best,  not 
as  valuable  as  the  white. 

But  Professor  Skertchly,  the  State  Geologist  of  Queens- 
land and  late  President  of  its  Royal  Society,  on  the  other 
hand  assured  me  that  it  was  impossible  for  the  white  man 
to  live  and  labour  in  the  tropics,  and  especially  emphasised 
the  impossibility  of  the  white  race  propagating  itself.  He 
says  that  the  statement  that  white  men  can  and  will  labour 
in  the  sugar  fields  "is  a  political  cry  and  not  a  proven  fact." 

"Tropical  agriculture,"  he  says,  "requires  not  only  a  hot 
but  a  moist  climate,  and  it  is  this  steaming  atmosphere 
with  but  little  change  of  temperature  which  surely,  even 
if  slowly,  undermines  the  vitality  and  energy  of  the  white 
who  unwisely  attempts  a  style  of  life  for  which  nature  has 
unfitted  him  through  centuries  of  education  in  less  trying 
regions." 

This  question  is  wider  than  Queensland.  Our  Hawaiian 
and  Philippine  and  West  Indian  accessions  make  it  a  burn- 
ing issue  for  the  United  States.  Benjamin  Kidd,  in  his 
book  on  "The  Control  of  the  Tropics,"  insists  that  the  white 
man  cannot  live  and  work  and  transmit  himself  in  the 
tropics. 

But  Alfred  Russel  Wallace  opposes  this  view  in  a  most 
interesting  contribution  which  he  made  to  the  "London 
Daily  Chronicle"  of  November  2,  1898.  As  the  result 
of  twelve  years  in  the  tropics,  spent  in  work,  he  says  that 
it  is  "because  white  men  as  a  rule  do  not  work  enough  in 
the  open  air  in  the  tropics  that  they  suffer  in  health."  They 
who  "suffer  most  in  the  tropics,"  he  says,  "are  women  of 
the  ruling  classes,"  and  they  are  the  ones  who  do  no  out- 
door work  at  all,  and  have  the  fewest  outdoor  occupations 
and  amusements.  He  goes  so  far  as  to  affirm  that  the  trop- 
ics, on  the  whole,  are  more  conducive  to  health  than  the 
temperate  regions.  They  are,  he  says,  the  most  lovely  and 


THE   ROAD   TO   PARADISE  315 

most  enjoyable  abodes  for  the  human  race,  for  there  it 
can  live  with  the  least  amount  of  labour,  and  secure  the 
greatest  amount  of  leisure  for  the  development  of  the  higher 
nature.  But  the  white  man  can  do  this  only  as  a  true  settler, 
not  as  an  exile  and  fortune  hunter.  He  must  not  have  his 
work  done  by  hiring  native  labour,  a  more  or  less  modified 
form  of  slavery,  according  to  Mr.  Wallace,  but  must  work 
himself  with  his  hands  as  well  as  his  head. 

With  these  results  of  his  experience  and  observation  be- 
fore him,  Mr.  Wallace  offers  "as  a  clear  and  definite  solu- 
tion of  'the  problem  of  the  tropics,'  "  that  "they  must  be 
gradually  occupied  by  white  men  in  co-operative  association 
to  establish  permanent  homes."  And  these,  he  goes  on  to 
say,  "surrounded  by  the  glories  of  tropic  vegetation  may 
in  time  become  something  like  a  legendary  paradise." 

At  Hawaii  I  found  the  large  planters  fully  conscious  of 
the  coming  perplexities  of  their  labour  supply  under  the  laws 
of  the  United  States.  Indeed  these  perplexities  had  already 
arrived.  Some  attempt  has  been  made  to  fill  the  labour 
void  by  the  importation  of  Japanese,  but  the  experience 
at  Hawaii  has  been  the  same  as  that  which  is  indicated  by 
the  significant  utterance  of  a  Queensland  planter,  in  an 
agricultural  conference  at  Mackay,  in  Queensland,  in  June, 
1899,  who  spoke  of  the  "intelligent,  enterprising  and  unde- 
sirable Jap."  The  Jap  is  too  intelligent  and  too  enterpris- 
ing to  submit  to  the  treatment  which  the  Chinaman  will 
bear  without  a  murmur.  The  Chinaman  never  resists,  but 
there  comes  a  moment  when  the  Jap  takes  his  knife  and 
goes  for  the  overseer. 

On  the  steamer  that  brought  us  back  to  America  was  an 
agent  of  a  syndicate  of  Hawaiian  planters  coming  to  the 
United  States  to  induce  American  farmers  to  settle  in  the 
islands,  to  grow  sugar  for  the  large  mills. 

In  Queensland  a  similar  movement  is  under  consideration. 


316        GOVERNMENT  &  CO.,  UNLIMITED 

One  of  the  proposals  discussed  at  the  Queensland  Agricul- 
tural Conference  just  spoken  of,  was  a  plan  for  the  assisted 
immigration  of  farm  labourers  from  England,  Germany  and 
other  European  countries. 

"It  is  in  Europe,"  said  the  principal  speaker  on  this  sub- 
ject, Mr.  G.  W.  Pott,  "that  we  will  find  the  labour  we  re- 
quire. In  Great  Britain,  Germany,  Denmark  and  other 
European  countries,  we  will  find  a  class  of  farm  labourers, 
thrifty,  sober,  industrious,  accustomed  to  long  hours  of 
steady  toil,  and  paid  at  a  rate  of  wages  in  many  cases  below 
that  paid  by  us  to  the  Kanakas." 

To  crown  the  efforts  to  advance  the  sugar  industry,  it  is 
proposed  by  some  of  the  leaders  in  the  Labour  Party  of 
Queensland  that  the  colony  shall  establish  a  "state  sugar  re- 
finery." This  would  refine  the  sugar  of  the  planters  at 
actual  cost.  The  commonwealth  would  then  act  as  a  broker 
for  the  sale  of  the  sugar  it  refined,  and  turn  over  to  the  pro- 
ducer all  the  profit  less  only  a  small  charge  to  cover  its  out- 
lay— "as  South  Australia  does  with  its  producers,"  one  of 
these  leaders  said  to  me. 

New  South  Wales  gives  no  subsidies,  but  its  sugar  inter- 
ests, as  the  statistics  show,  are  prospering  at  about  the  same 
rate  as  those  of  Queensland.  The  colony  of  Victoria  re- 
cently appropriated  $250,000  to  establish  a  sugar-mill  at 
Maffra,  and  subsidised  the  farmers  to  grow  beets  for  three 
years,  and  when  I  was  there  the  officials  were  sanguine  of 
success.  But  since  then  comes  news,  in  September,  1899, 
that  the  mill  has  been  closed.  New  Zealand  was  the  first 
to  subsidise  the  sugar  industry.  It  has  been  giving  bonuses 
and  other  help  for  'twenty-two  years,  but  nothing  of  value 
has  yet  been  accomplished. 

Victoria  is  a  protectionist  colony;  New  South  Wales, 
free  trade.  It  is  one  of  the  paradoxes  of  Australia  to  see 
these  two  states,  with  policies  so  opposite,  side  by  side,  and 


THINKING   WHAT   CAN   BE  DONE        317 

both  flourishing,  so  far  as  observation  and  statistics  show, 
about  equally  well. 

The  credit  of  all  the  Australasian  colonies  is  inseparably 
bound  up  with  the  ability  of  their  people  to  obtain,  by  sales 
in  foreign  markets,  the  means  to  pay  the  taxes  out  of  which 
interest  and  principal  on  the  very  heavy  debts  abroad  must 
be  met,  to  say  nothing  of  the  taxes  to  be  paid  at  home. 
They  have,  therefore,  all  of  them,  taken  hold  with  their  peo- 
ple to  make  the  export  trade  as  successful  as  possible. 

"It  has  been  my  business  for  years,"  the  Under-Secretary 
of  Agriculture  at  Melbourne  said  to  me,  "to  sit  here  and 
think  out  what  can  be  done  to  help  our  producers." 

His  department  has  established  travelling  dairies  and 
model  schools,  and  sent  lecturers  all  over  the  country  to  tell 
the  farmers  how  to  take  care  of  their  milk,  and  how  to  get 
the  best  results  in  butter  and  cheese.  The  teaching  was  at 
first  practical,  now  it  is  scientific. 

Refrigerating  cars  were  put  upon  the  railway  lines,  cool 
stores  were  provided  at  the  country  railway  stations,  refrig- 
erating chambers  were  built  in  Melbourne,  and  the  depart- 
ment undertook  to  inspect  and  brand  butter  for  export.  A 
bonus  of  two  to  six  cents  a  pound  was  paid  for  several  years 
on  all  butter  sold  abroad  for  which  the  seller  could  show  his 
receipted  bill  of  sale.  The  industry  has  now  been  so  well 
established  that  the  bonus  is  discontinued. 

In  its  cold-storage  warehouses  at  Melbourne  the  govern- 
ment grades,  packs  and  ships  the  butter.  This  cold  storage 
was  at  first  provided  free,  as  it  still  is  in  New  Zealand,  but 
now  a  charge  is  made.  At  first  no  poor  butter  was  allowed 
to  be  exported  under  the  official  brand,  but  lately  what  is 
called  a  "fire  brand"  has  been  adopted,  under  which  inferior 
butter  may  be  shipped  for  the  use  of  pastry  cooks. 

Victoria  acts  as  the  representative  of  the  shippers  collec- 
tively in  making  contracts  with  the  steamship  companies  for 


3i8         GOVERNMENT  &  CO.,  UNLIMITED 

freight,  and  these  contracts  include  the  use  of  refrigerating 
chambers. 

"A  wonderful  success  has  attended  this  help  to  the  dairy 
interest  of  Victoria,"  the  Under-Secretary  for  Agriculture 
said.  "Victoria  is  now  the  largest  exporter  of  butter  except 
Denmark." 

If  butter  from  a  particular  factory  has  anything  the  mat- 
ter with  it,  an  inspector  goes  there  and  finds  out  what  the 
trouble  is. 

Under  the  direction  of  the  cattle  inspector  diseased  cattle 
are  killed  without  compensation  to  the  owner,  on  the  ground 
that  such  animals  are  of  no  value  to  the  owner  or  anybody 
else. 

The  export  business  in  poultry  has  been  developed  in  sim- 
ilar ways.  The  size,  weight,  etc.,  of  the  shipments  are  of- 
ficially regulated.  The  experiment  has  been  a  success,  but 
not  as  successful  as  that  in  butter. 

The  government  initiated  the  export  of  frozen  rabbits. 
The  Under-Secretary  for  Agriculture,  looking  about  for 
"things  that  could  be  done  to  help  the  producers,'"'  saw  in 
the  destruction  of  rabbits  a  great  waste  of  food.  The  rab- 
bits are  now  received  at  cold-storage  chambers,  sorted  out, 
and  all  those  that  are  fly-blown  and  otherwise  imperfect 
rejected.  This  inspection  is  carried  on  with  incredible 
swiftness  by  men  who  have  grown  expert. 

When  I  was  in  Melbourne  there  were  900  tons  of  frozen 
rabbits  in  the  warehouses.  The  wholesale  price  which  is 
received  in  London  for  these  rabbits  runs  from  sixteen  to 
twenty  cents  each.  This  export  and  the  requirement  that 
landowners  keep  down  the  rabbits  hold  in  subjection  the 
pest  which  once  threatened  all  the  pastures  of  Victoria  with 
ruin.  What  Pasteur  failed  to  accomplish  with  his  scheme 
of  inoculation  with  contagious  disease  is  being  done  by 
the  demand  of  the  markets. 


BONUS   OF  TEN   DOLLARS   AN   ACRE     319 

Victoria  has  sent  to  America  for  the  best  tobacco  expert 
whom  our  Washington  Agricultural  Department  could  rec- 
ommend to  it,  and  he  is  now  at  work  under  a  three  years' 
engagement,  doing  all  that  he  can  to  improve  the  tobacco 
culture  of  the  colony.  Under  his  advice  the  Minister  of 
Agriculture  has  established  an  experimental  farm  to  give 
instruction  to  the  tobacco  growers,  and  a  bonus  is  being 
paid  of  several  cents  a  pound  on  all  tobacco  sold  abroad.  A 
shipment  of  fifty  tons  had  just  been  made  when  I  was  in 
Melbourne,  and  as  much  more  was  to  be  shipped  the  next 
week. 

Fruit  culture  has  been  developed  by  the  payment  of  a 
bonus  to  the  growers  of  ten  dollars  an  acre  in  gradual  in- 
stalments, covering  six  years.  A  horticultural  expert  is 
sent  around  the  country  to  teach  the  principles  of  the  art. 
Attention  is  given  mainly  to  the  export  of  apples.  These 
are  shipped  by  the  growers  in  ordinary  crates  to  the  cold 
stores  of  the  department ;  they  are  then  chilled  to  bring  out 
the  blemishes,  after  which  they  are  sorted  and  shipped  again 
in  refrigerating  chambers.  Orchards  are  inspected  regu- 
larly also  upon  request.  If  insects  or  other  plagues  are  not 
removed  according  to  directions,  the  growers  are  fined.  The 
expert  tells  the  farmers  what  trees  to  plant  and  how  to  take 
care  of  them.  An  analysis  of  soil  is  made  for  a  nominal 
charge.  This  was  at  first  made  free  until  it  was  found  that 
the  analyses  were  asked  for  without  being  used. 

Special  hopes  are  entertained  of  the  future  of  the  wine 
industry.  The  state  has  established  a  school  of  viticulture 
and  has  started  three  vineries,  and  it  also  gives  a  bonus  in 
case  of  the  opening  up  of  a  foreign  market. 

An  export  of  honey  sent  to  London,  under  the  auspices 
of  the  Agricultural  Department,  brought  back  the  report 
from  that  city,  unaccustomed  to  the  peculiar  flavour  given 
by  the  eucalyptus,  that  "this  honey  might  possibly  be  use- 


320         GOVERNMENT  &  CO.,  UNLIMITED 

ful  for  medicinal  purposes,  but  for  no  others."  Not  dis- 
couraged, however,  by  this,  the  export  continues  and  is 
creating  a  constituency  of  its  own. 

In  all  its  dealings  with  the  producer,  the  rule  of  Victoria 
has  been  to  let  him  choose  his  own  agent  in  London,  if  he 
desired  to  do  so.  If  not,  it  will  undertake  to  find  one  for  him. 

A  horticultural  school  started  recently  by  Victoria  was 
meant  for  men,  but  it  was  announced  that  if  women  wanted 
to  come  they  would  be  admitted.  To  every  one's  surprise 
the  school  was  at  once  flooded  with  women.  Every  seat 
was  taken,  and  further  admissions  had  to  be  refused. 

Well-to-do  women  come  because  they  want  to  learn 
enough  to  see  that  their  gardeners  do  the  right  thing;  poor 
women  come  to  add  another  means  of  making  a  living;  and 
a  familiar  figure  is  the  factory  girl  who  has  been  warned 
by  her  doctor  that  she  must  betake  herself  to  an  outdoor 
life,  if  she  would  live.  There  are  lectures  and  practical 
work  in  gardens  and  orchards  adjoining  the  school. 

In  1896  $775,000  was  thus  spent  by  a  people  numbering 
only  1,100,000  in  the  development  of  agriculture  and  min- 
ing. An  allowance  up  to  $2.50  an  acre  is  made  to  the 
lessees  of  pastoral  land  for  improvements  that  add  to  the 
stock-carrying  capabilities  of  the  land. 

The  work  of  irrigation  which  in  the  United  States  is  left 
to  private  enterprise  has  been  taken  up  in  Victoria  by  the 
state.  A  commission  was  sent  some  years  ago  to  America 
to  study  the  results  of  our  experience,  and,  upon  the  publi- 
cation of  its  report,  Victoria  embarked  upon  an  extensive 
scheme.  Up  to  1896  the  colony  had  already  spent  over 
$2,000,000,  and  had  plans  which  contemplated  the  expen- 
diture of  nearly  $4,000,000  more.  This  was  in  addition  to 
an  advance  of  nearly  a  million  to  private  companies,  to 
whom  further  advances  will  be  made  of  several  millions  of 
dollars. 


THE  EDUCATIONAL  CAMPAIGN  321 

The  Mining  Department  in  many  districts  sets  up  bat- 
teries at  which  it  crushes  ores  for  a  small  charge.  Money 
is  also  advanced  to  companies  and  parties  of  not  less  than 
four  miners  for  the  prospecting  and  development  of  new 
territory. 

To  promote  the  growth  of  manufactures  the  Ministry 
asked  the  Commissioner  of  Railroads  to  carry  coal  at  a  uni- 
form charge  of  a  half  penny  a  ton  a  mile.  The  commis- 
sioner, however,  refused.  It  was  no  part  of  his  business, 
he  said,  to  do  the  work  of  other  departments  and  develop  the 
country  at  the  expense  of  the  railway  department.  The 
controversy  was  settled  by  an  allowance  made  out  of  the 
Treasury  to  the  railroad  department  of  one  farthing  a  ton  a 
mile,  which  just  saved  the  railway  department  from  loss, 
and  coal  is  now  being  carried  at  the  rate  of  a  half  penny 
a  ton  a  mile  throughout  the  colony,  the  Treasury  standing 
the  loss. 

One  of  the  unique  contributions  of  the  state  to  the  devel- 
opment of  industry  in  Victoria  has  been  the  educational 
campaign.  It  set  to  work  systematically  to  teach  the  peo- 
ple co-operation.  Little  pamphlets  were  printed  and  dis- 
tributed throughout  the  colony  reciting  the  methods  by 
which  co-operation  had  been  made  the  wonderful  success  it 
is  in  England  and  in  Continental  Europe.  Lecturers  were 
sent  out  to  talk  to  the  people  on  the  same  subject.  The  re- 
sult has  been  that  the  whole  country  is  now  dotted  with  co- 
operative dairies  and  creameries.  There  are  joint-stock 
creameries  also,  but  the  co-operative  farmers  are  doing 
much  the  largest  part  of  the  work. 

Its  free  trade  bias  is  shown  in  the  different  procedure  of 
the  colony  of  New  South  Wales  when  it  followed  the  lead  of 
Victoria  and  established  a  Board  for  Exports.  This  did  not 
begin  operations  until  1897,  and  has  therefore  not  as  yet 
achieved  the  results  which  have  been  noted  in  Victoria. 


322         GOVERNMENT  &  CO.,  UNLIMITED 

New  South  Wales  emphasises  the  fact  that  it  does  not  buy 
or  sell  any  article  or  produce  on  behalf  of  the  owners.  Its 
principal  aim  is  to  open  neglected  markets.  It  provides 
cold  storage  and  shipping  facilities  very  much  as  Victoria 
does,  but  everything  of  that  sort  in  New  South  Wales  "has 
to  be  paid  for  at  commercial  rates,"  the  report  says,  "so  that 
no  undue  advantages  are  given  to  exporters  at  the  expense 
of  the  general  taxpayer." 

The  state,  in  South  Australia,  makes  advances  to  the  pro- 
ducers on  the  value  of  their  shipments,  but  the  producer  of 
New  South  Wales  must  look  to  private  sources  for  such 
accommodation.  Agents  of  the  London  merchants  in  Syd- 
ney make  advances  to  the  extent  of  half  or  three  fourths  of 
the  probable  selling  value  of  products  as  soon  as  they  have 
received  the  brand  of  the  Board  for  Exports.  A  very  con- 
siderable increase  of  prices  is  reported  as  one  of  the  benefits 
which  have  been  received  by  the  producers  from  the  estab- 
lishment of  this  board. 

The  statistics  show  the  benefit  Victoria  has  had  from  its 
policy  of  bonuses  on  the  export  of  butter.  In  the  years 
1888  and  1896  the  exports  of  butter  from  New  South  Wales 
increased  from  764,960  pounds  to  2,707,088  pounds,  while 
those  of  Victoria  increased  from  1,202,649  pounds  to  22,- 
170,790.  The  export  went  as  high  as  25,660,782  in  1895, 
but  was  cut  down  by  the  drouth. 

South  Australia  follows  Victoria  in  this  policy  of  state 
aid  to  the  producer,  and  has  added  to  it  a  characteristic  fea- 
ture of  its  own  called  the  Produce  Export  Department.  This 
receives  products  at  the  ports  of  shipment  in  South  Aus- 
tralia and  disposes  of  them  in  the  London  market.  The  Pre- 
mier, the  Honourable  C.  C.  Kingston,  in  his  annual  speech 
to  his  constituents,  in  March,  1896,  said:  "We  thought 
that  while  throwing  open  the  land  we  ought  to  enable  the 
people  to  live  on  it  and  get  a  market  for  their  products." 


ALL   THE   FARMER    HAS    TO    DO          323 

The  law  for  this  experiment  was  passed  in  1893,  and  the 
work  was  begun  in  1894.  At  the  formal  opening  of  the 
depot  in  1895,  the  Minister  of  Agriculture,  the  Honourable 
John  A.  Cockburn,  said  that  the  liberal  legislation  for  the 
settlement  of  the  people  on  the  land,  and  the  work  done  by 
the  Agricultural  Bureau,  with  its  innumerable  branches 
throughout  the  country,  and  by  the  Agricultural  College, 
was  of  little  use  if  the  producers  were  not  somehow  enabled 
to  place  their  produce  advantageously  on  the  world's  mar- 
kets. It  was  for  this  reason  that  the  depot  was  established, 
and  the  Minister  of  Agriculture  predicted  "that  when  the 
history  of  the  colonies  came  to  be  written,  it  would  be  seen 
that  no  more  important  step  than  this  was  ever  taken  by  any 
legislature,  and  that  it  was  a  step  which,  at  no  distant  date, 
would  be  followed  by  all  the  other  colonies." 

"Before  the  state  moved  in  this  direction,"  he  said,  in  an 
address  in  Philadelphia,  in  1899,  "the  small  farmer  or  fruit 
grower  was  practically  unable  to  reach  the  markets  of  the 
world,  even  if  there  was  a  great  demand  for  his  produce. 
The  rates  for  freight  and  insurance  were  so  high  on  small 
shipments  that  practically  they  were  excluded.  So  the 
state  stepped  in  and  by  grouping  together  the  little  rivulets 
of  produce  into  one  shipment,  sends  them  forward  at  the 
lowest  possible  charges.  The  state  in  this  way  has  brought 
the  world's  markets  within  the  reach  of  the  farmer  and  fruit 
grower. 

"All  the  farmer  has  to  do  in  South  Australia,  when  he 
wishes  to  send  a  box  of  honey,  butter,  or  some  sheep 
abroad,  is  to  write  to  the  Agricultural  Department,  and  if 
they  are  approved  and  forwarded,  the  farmer  has  noth- 
ing more  to  do  but  to  sit  at  home  and  wait  returns  by 
check." 

The  department  receives  at  Port  Adelaide,  in  South  Aus- 
tralia, for  sale  in  London,  cattle,  rabbits,  poultry,  alive  or 


324        GOVERNMENT  &  CO.,  UNLIMITED 

dead,  butter,  grain,  wine,  honey,  fruit,  and  any  produce 
for  which  there  is  a  prospect  of  a  demand. 

In  fact,  the  state  meets  the  farmer  long  before  he  comes 
to  the  doors  of  the  receiving  depot  in  Port  Adelaide,  for  the 
railway  station  to  which  he  delivers  his  stuff  is  its  property 
— his  property — and  after  he  makes  his  delivery  there  the 
state  does  the  rest,  all  the  way  to  London  and  back. 

At  the  opening  of  the  Produce  Export  Depot,  in  1895, 
the  Minister  of  Agriculture  pointed  out  that  instead  of  con- 
ducting their  business  entirely  with  distant  agents  in  Eng- 
land, as  they  had  been  doing,  the  producers  could  "now  go 
into  partnership  with  the  agent-general  in  London  and  the 
manager  of  the  London  depot,  who  would  act  as  principals 
for  them,  and  would  see  that  they  got  full  justice  and  fair 
play.  The  government  does  the  business  at  both  ends," 
he  said. 

The  men  who  raise  the  food  and  raw  material  of  the 
world  do  well  if  they  make  a  bare  living,  and  the  wealth 
somehow  sticks  to  the  men  who  sell  it  for  them,  but  the 
Produce  Export  Department  of  South  Australia  is  a  com- 
mission merchant  or  broker  who  can  have  no  secrets  from 
its  customers.  The  public  accounts  tell  the  exact  story  of 
all  the  dealings  down  to  the  last  cent  of  the  receipts  and  ex- 
penditures. Here  is  the  only  broker  of  whom  the  producers 
know  that  they  get  precisely  what  he  gets,  less  the  neces- 
sary cost  of  the  marketing. 

The  commonwealth  puts  its  fraternal  arm  about  the  far- 
mer even  before  he  goes  to  the  railway  with  his  shipment. 
Besides  employing  experts  to  tell  him  what  to  raise  and  how 
to  cater  to  the  customer,  it  analyses  his  soils  and  fertilisers, 
and  supplies  seeds  and  cuttings. 

Minister  Butler  of  the  Agricultural  Department,  in  an 
address  at  the  Agricultural  Bureau  Congress,  in  September, 
1898,  speaks  of  how  he  sends  inspectors  who  get  samples  of 


SAVING  BY  LOSING  325 

fertilisers  from  the  dealers,  which  are  then  examined  by  an 
official  analyst.  The  results  of  the  analysis  and  the  ap- 
proximate fertilising  value  and  any  other  papers  which  the 
minister  thinks  necessary  are  then  published  in  the  state's 
"Journal  of  Agriculture,"  together  with  the  price  which  the 
dealers  ask.  There  is  no  attempt  to  fix  the  prices  at  which 
the  articles  are  to  be  sold,  but  the  department  means  to 
see  to  it  that  the  buyer  shall  know  precisely  what  he  is 
getting. 

The  much  abused  "state"  does  not  seem  to  be  wholly 
lacking  in  business  ability.  The  report  of  its  Produce  Ex- 
port Department  notes  that,  during  the  summer  months 
when  there  was  little  produce  being  brought  in  for  export, 
the  cold-storage  rooms  were  rented  out  to  butchers,  produce 
dealers  and  others.  This  saved  for  them  very  large  quantities 
of  stuff  which  otherwise  would  have  perished,  and  it  gave 
the  department  an  income  and  enabled  it  to  keep  its  em- 
ployes at  work  instead  of  shutting  down. 

Democracy  can  do  business  at  a  loss  and  still  make  money. 
A  homely  illustration  of  this  is  shown  in  the  operations  of 
this  export  department  with  rabbits.  It  loses  money  on  the 
rabbits  which  it  receives,  sorts,  refrigerates  and  ships,  as  it 
charges  the  same  price  as  is  fixed  in  Victoria,  where  the 
business  can  be  done  much  cheaper  as  it  is  very  much  larger. 
But  the  Minister  of  Agriculture  points  out  that,  though  not 
directly  remunerative,  this  business  is  remunerative  indi- 
rectly. It  gives  employment  for  labour,  increases  the 
railway  revenue,  converts  what  has  been  a  scourge  into 
cash,  and  enlarges  the  capacity  of  the  country  to  carry 
sheep.  Were  these  rabbits  not  thus  made  a  marketable 
commodity,  they  would  be  ruining  some  of  the  best  lands 
in  the  colony. 

"Individual  enterprise"  could  not  look  beyond  the  im- 
mediate loss,  but  democracy,  acting  in  this  way,  with  one 


326        GOVERNMENT  &  CO.,  UNLIMITED 

mind  for  the  common  good,  is  a  larger  sort  of  "individual 
enterprise."  It  fulfils  Browning's  fine  definition  of  the 
people, 

"A  people  is  but  the  attempt  of  many 
To  rise  to  the  completer  life  of  one." 

Animals  may  be  delivered  at  the  export  depot  at  Port 
Adelaide,  South  Australia,  either  alive  or  slaughtered.  If 
delivered  alive,  the  department  will  see  that  they  are  prop- 
erly killed,  dressed,  chilled,  shipped  and  sold,  and  the  gov- 
ernment, which  is  not  too  big  to  do  little  things  well,  informs 
the  producers  that  "when  the  slaughtering  is  undertaken  by 
the  department,  the  fat  and  skin  will  be  returned  to  the 
owner,"  but  "the  remaining  by-products  become  the  property 
of  the  department." 

South  Australia  will  even  receive  ducklings,  goslings,  or 
any  other  kind  of  poultry  alive,  if  the  farmer  so  prefers, 
and  will  kill,  dress,  grade,  pack,  freeze,  ship,  insure,  sell  and 
remit,  all  according  to  a  schedule  of  charges  furnished  the 
shipper  in  advance.  It  goes  a  good  ways  farther  back  than 
that  in  its  care  of  the  shipper.  Not  content  with  seeing 
that  he  ships  no  butter  to  London  that  is  not  up  to  grade, 
it  goes  back  from  the  butter  to  the  bull,  in  whose  virtues 
the  excellence  of  the  butter  must  originate.  In  the  report 
for  1898  the  Minister  of  Agriculture  notes  the  purchase 
of  eight  bulls,  five  Jerseys,  two  Ayrshires  and  one  Holstein, 
which  have  been  sent  to  various  dairying  centres.  By  1899 
there  were  twenty-three  bulls  stationed  in  different  parts  of 
the  province.  The  town  bull  has  long  been  a  familiar  figure 
in  the  agricultural  industry  of  the  world.  Here  we  have  the 
appearance  for  the  first  time  of  the  "state"  bull.  Danton 
proposed  a  similar  enterprise  to  the  revolutionary  govern- 
ment of  France. 


A  STATE  SHIP  327 

Like  Victoria,  South  Australia  has  stimulated  the  butter 
business  by  the  giving  of  bonuses,  and,  in  his  speech  in  1896, 
Premier  Kingston  pointed  out  the  effect  of  this  butter 
bonus.  Up  to  1893,  when  the  bonus  was  given,  the  total 
value  of  the  butter  sent  to  England  had  been  only  $6000. 
The  export  in  the  two  years  since  has  been  $550,000.  When 
he  was  giving  particulars  of  the  beneficial  results  of  the 
working  of  the  export  department,  he  was  interrupted  by  a 
voice  in  the  audience,  which  exclaimed,  "You  will  want  a 
state  ship  next." 

"Yes,"  the  Premier  replied,  "to  carry  some  people  away." 

Then,  leaving  the  jest,  he  acknowledged  that  the  colony 
had  serious  thoughts  of  supplying  ships  as  an  additional  link 
in  their  facilities,  and  the  same  enterprise  is  under  consider- 
ation in  New  Zealand. 

Special  efforts  are  made  by  South  Australia  to  develop 
the  sale  of  wine  in  London.  The  exports  have  increased 
rapidly,  and  the  colony  is  now  debating  whether  to  subsidise 
co-operative  wine  cellars  in  South  Australia,  or  to  establish 
state  cellars  of  its  own. 

The  struggle  to  find  a  market  in  England  for  colonial  prod- 
uce runs  up  against  serious  obstacles  in  the  trade  customs 
of  the  mother  country.  The  London  agent  of  South  Aus- 
tralia reports  that  he  is  unable  to  get  the  attention  of  certain 
houses  unless  he  is  willing  to  fall  in  with  the  "custom  of 
the  country"  and  pay  commissions  "varying  in  degree  with 
the  importance  of  the  firm." 

His  efforts  to  market  olive  oil  were  blocked  from  the 
fact  that  the  leading  firms  in  London  dealing  in  that  com- 
modity were  interested  in  continental  oils,  and  were  not 
only  unfavourable  to  any  new  competition,  but  would 
"crab"  any  other  oils — a  market  expression  which  needs 
no  elucidation  to  those  who  understand  crab  locomotion. 
They  have  "vested  interests  in  their  own  goods  to  protect." 


328         GOVERNMENT  &  CO.,  UNLIMITED 

The  Agricultural  Department  of  South  Australia  makes 
freight  contracts  for  the  shippers,  and  the  Minister  has  stated 
that  the  Australasian  colonial  governments  are  all  working 
together  to  secure  reductions  in  freights  and  other  charges. 

The  state  puts  its  stamp  "Approved  for  Export"  on  no 
wines  or  butter,  or  other  things,  without  knowing  that  they 
are  precisely  what  they  pretend  to  be  and  what  they  ought 
to  be.  "If  articles  are  inferior,"  says  the  Minister  of  Agri- 
culture, "we  have  nothing  to  do  with  them."  However,  if 
rejected,  the  department  does  not  withhold  its  further  help 
from  the  unfortunate  producer.  It  undertakes  to  sell  for 
his  account  any  shipment  which  it  has  rejected  as  unfit  for 
export.  His  produce,  therefore,  is  not  thrown  back  on  his 
hands  as  a  total  loss. 

The  success  of  the  Produce  Export  Depot  has  been 
incontestable.  Its  business  doubled  in  1898.  In  a  bulletin 
issued  in  February,  1899,  the  Minister  of  Agriculture  an- 
nounced that  the  storage  capacity  is  to  be  increased  at  once 
to  more  than  double,  and  that  estimates  and  plans  for  new 
works  with  still  larger  capacity  are  being  prepared  to  go 
into  operation  probably  in  the  following  year. 

Best  of  all,  the  slight  deficit  of  the  previous  years  has 
been  wiped  out,  and  the  returns  of  the  business  for  1899 
fulfilled  the  promise  of  the  previous  growth  that  the  tax- 
payer will  not  be  called  upon  to  pay  anything  for  the  ex- 
periment. The  first  half  year's  work  in  1899  shows  a  bal- 
ance sufficient  to  pay  interest  at  the  rate  of  three  per  cent, 
on  the  investment,  and  there  was  a  profit  on  the  whole  year's 
operations. 

Through  the  export  depot  the  producers  get  higher  prices, 
and  steadier — the  South  Australian  apples  sent  to  London 
through  the  depot  brought  the  highest  price  of  any  mar- 
keted there.  The  Minister  of  Agriculture  estimates  that 
the  export  depot  has  added  ios.,  $2.50,  an  acre  to  the 


FARMERS'   SUB-TREASURY  SCHEME      329 

value  of  all  lands  in  South  Australia  fit  for  growing 
lambs,  butter,  wine  and  fruit.  Following  the  same  policy 
as  that  of  New  Zealand  as  to  railway  charges  Minister  But- 
ler promises  that  as  soon  as  the  export  depot  "is  able  to  pay 
anything  like  four  per  cent,  interest  above  expenses  its 
charges  will  be  proportionately  reduced.  That  is  where  the 
advantage  of  the  state  having  the  department  comes  in.  In 
a  department  carried  on  by  private  enterprise  you  could  not 
expect  such  a  reduction,  but  we  have  no  shareholders  to 
whom  a  profit  has  to  be  paid." 

South  Australia  advances  money  to  the  farmer  at  both 
ends  of  his  labours.  It  lends  him  money  through  the  state 
bank,  as  has  been  described,  on  his  farm,  and  then,  when 
his  produce  has  reached  the  export  depot,  if  it  has  passed  the 
inspection  and  has  been  "approved  for  export,"  it  will  lend 
him  money  on  the  value  of  the  shipment.  In  its  directions 
to  shippers  the  statement  is  made  that  "advances  will  be 
made  on  produce  at  the  discretion  of  the  Minister,  interest 
being  at  the  rate  of  five  per  cent,  per  annum." 

Oceans  of  ridicule  were  poured  on  the  agitation  a  few 
years  ago,  among  the  American  farmers,  to  get  the  national 
treasury  to  advance  them  money  on  the  security  of  their 
wheat,  cattle  and  other  products.  The  farmers  were — and 
are — being  bled  to  death  by  the  elevators,  commission  men 
and  railroads,  and  they  wanted — and  want — relief.  That 
which  seemed  so  preposterous  to  the  critics  of  the  farmers 
of  the  United  States  we  find  is  in  actual  operation  in  many 
of  the  Australian  commonwealths — New  Zealand,  Victoria, 
South  Australia,  Western  Australia,  for  instance.  These 
Anglo-Saxons  are  "self-helpers,"  if  there  ever  were  any. 

There  has  been  of  course  a  strong  Australian  opposition 
to  all  this  from  those  who  believe  that  the  government 
should  perform  none  but  negative  functions,  but  even  the 
most  pronounced  of  these  laissez-faire  theorists  are  being 


330        GOVERNMENT  &  CO.,  UNLIMITED 

won  over  by  the  indubitable  success  of  the  experiments.  In 
defending  this  policy  Dr.  Cockburn,  once  Minister  of  Agri- 
culture of  South  Australia,  has  said : 

"If  you  bring  hope  into  the  life  of  the  farmer  and  make 
him  sure  of  his  reward  and  that  his  profit  will  not  be  taken 
away  from  him  you  make  him  more  efficient.  Instead  of 
sapping  private  enterprise  we  are  assisting  private  enterprise. 
We  are  not  anxious  to  organise  patriarchal  institutions,  but 
fraternal  ones." 

This  policy  can  be  seen  at  work  nearer  home.  The  ex- 
port business  of  Canada  in  butter  and  cheese  has  been  in- 
creased by  wonderful  percentages.  One  cause  is  the  very 
stern  prohibition  of  spurious  products,  like  filled  cheese. 
Another  is  the  direct  aid  given  to  the  industry.  Any  one 
who  wants  to  understand  the  subject  of  "Government  & 
Company,  Unlimited,"  can  do  no  better  than  to  read  the 
reports  of  the  Canadian  Commissioner  of  Agriculture.  The 
Dominion  makes  loans  to  the  farmers  in  Prince  Edward 
Island  and  in  the  Northwest  territories  in  aid  of  the  con- 
struction of  butter  and  cheese  factories.  It  gives  a  bonus 
to  creameries  for  a  costly  cold-storage  plant  in  accordance 
with  official  plans. 

The  provinces  of  Quebec,  Nova  Scotia  and  New  Bruns- 
wick also  give  bonuses,  some  of  them  considerable  ones,  to 
promote  the  erection  of  factories  and  creameries. 

The  government  of  Canada — which  seems  to  have  an 
"eagle  eye,"  as  well  as  "private  enterprise" — further  ob- 
served that  the  cheese  factories,  since  they  could  make  their 
product  only  in  the  summer,  had  to  be  idle  during  the  win- 
ter. To  put  a  stop  to  this  waste  of  time,  capital  and  la- 
bour, it  undertook  to  teach  the  farmers  that  butter  could 
be  made  in  their  cheese  factories  in  the  winter  time,  and  to 
assist  them,  financially  and  otherwise,  during  the  pioneer 
period.  It  gave  the  necessary  instructions  and  contributed 


DIFFERENT  KINDS  OF  HUMAN  NATURE    331 

part  of  the  money  and  machinery  needed.  To  induce  the 
farmers  to  go  into  this  new  departure  of  winter  dairying 
the  Dominion  even  undertakes  to  run  the  works  itself  at 
first,  to  push  the  sale  of  the  butter,  and  to  make  monthly 
advances  of  money  to  the  farmers  on  the  value  of  their 
product. 

Like  Victoria,  Canada  acts  as  an  evangel  of  the  gospel 
of  co-operation  among  the  farmers,  and  puts  in  the  full 
plants  required  for  co-operative  dairies.  It  usually  finds 
the  farmers  reluctant  in  the  beginning,  but  has  invariably 
changed  them  into  hearty  supporters  of  the  experiment. 

In  many  districts  the  farmers  are  organising  themselves 
and  establishing  co-operative  dairies  wholly  at  their  own 
expense,  provided  the  government  will  run  them  in  their 
behalf  during  the  initial  period. 

Of  course  "we  cannot  change  human  nature,"  but  per- 
haps there  are  different  kinds  of  human  nature  in  the  world. 

The  Dominion  of  Canada  seeing,  like  the  Australian  col- 
onies, that  cold  storage  is  indispensable  to  export  and  that 
export  is  indispensable  to  the  modern  producer,  has  for 
years  been  spending  large  sums  to  supply  its  farmers  with 
cold  storage  on  the  railways  and  steamship  lines  in  all  di- 
rections. This  was  done,  with  Treasury  help,  on  seventeen 
steamships  between  Great  Britain  and  Montreal  alone  in 
1897.  One  result  of  this  intervention  of  "politics"  was  to 
perfect  the  refrigerator  service,  which  had  been  such  in 
name  only ;  for  "private  enterprise"  had  been  so  careless  and 
unscientific  that  instead  of  keeping  its  cold  air  around  the 
contents  of  the  cars  it  had  been  pouring  it  out  along  the 
tracks  through  leaky  pipes. 

It  was  New  Zealand  that  originated  the  system  of  grad- 
ing for  export — and  it  grades  for  domestic  use  as  well — 
which  has  been  so  widely  adopted  in  the  other  colonies. 
This  was  at  first  opposed  as  "interference  with  the  liberty 


332         GOVERNMENT  &  CO.,  UNLIMITED 

of  the  subject."  But  the  dairyman  did  not  take  long  to 
find  out  that  it  was  the  gift  of  a  new  liberty  to  be  told  at 
once  of  defects  in  his  butter,  due  to  some  carelessness  or 
fault  of  the  farmer  or  manager  of  the  creamery.  This 
makes  it  possible  for  him  immediately  to  correct  it  and  not 
go  on  shipping  a  poor  article  the  whole  season  to  London, 
only  to  learn,  too  late,  that  it  had  been  found  unsaleable 
there.  The  colony  in  addition  provides  cold  storage  for 
products  for  export,  and  makes  no  charge. 

The  grading  protects  the  good  farmer  from  the  bad,  the 
honest  from  the  dishonest. 

New  Zealand  was  the  first  to  give  a  bonus  on  export, 
which  it  did,  in  1882,  by  paying  a  prize  of  $2500  for  the 
first  export  of  fifty  tons  of  cheese.  In  the  same  year  it 
gave  the  same  prize  for  the  first  shipment  of  frozen  meat. 

It  was  also  the  pioneer  in  acting  as  the  schoolmaster  of 
co-operation.  If  the  farmers  of  any  district  want  to  es- 
tablish one  of  the  co-operative  dairies,  of  the  success  of 
which  in  different  parts  of  the  world  they  hear  so  much,  the 
Agricultural  Department  will  send  an  expert  to  look  over 
the  ground,  and  if  he  finds  that  there  are  cows  to  supply 
enough  milk  and  that  a  sufficient  amount  of  capital  can  be 
raised  by  the  farmers,  the  department  supplies,  free  of 
charge,  plans  and  specifications  for  creameries  and  for  the 
machinery.  A  recent  law  authorises  the  advance  of  money 
for  the  erection  of  creameries,  provided  the  farmers  find  a 
proper  proportion  of  the  capital  themselves,  and  applica- 
tions are  now  being  received  for  this  purpose. 

Flax  grows  everywhere  in  New  Zealand,  and  a  prize  is 
offered  for  an  improved  process  for  treating  the  fibre. 
Bonuses  have  been  given  for  the  successful  manufacture  of 
new  products — felt  and  other  things. 

New  Zealand  has  under  consideration  a  plan  for  a  gov- 
ernment warehouse  in  London.  It  maintains  a  produce 


THE  PUBLIC  BUYS  A  PATENT  333 

commissioner  in  London,  and  he  is  urging  that  the  col- 
ony should  open  at  least  one  shop  in  each  town  of  im- 
portance in  England,  solely  for  the  sale  of  New  Zealand 
meat.  A  still  more  ambitious  suggestion  comes  from  Vic- 
toria. Minister  of  Agriculture  Taverner,  after  a  visit  to 
England  to  study  the  marketing  of  Australian  products, 
has  made  a  report  recommending  that  the  various  Australian 
colonies  should  combine  to  erect  large,  cool  stores  at  the 
London  docks,  to  cost  $1,125,000,  and  also  that  they  estab- 
lish produce  exchanges  in  various  parts  of  London. 

While  doing  his  studying  Mr.  Taverner  also  did  some 
business  for  his  constituents.  He  arranged  for  direct  steam- 
ship communication  for  the  first  time  between  Victoria  and 
Manchester,  and  also  got  reductions  of  freights  on  colonial 
products  averaging  fifteen  per  cent. 

The  local  authorities  of  New  Zealand  are  empowered  by 
Parliament  to  use  their  money  to  aid  in  the  development  of 
mining,  and  Parliament  appropriates  suitable  sums  to  sub- 
sidise roads  to  the  mines  and  to  give  rewards  for  the  dis- 
covery of  new  fields,  both  to  individuals  and  companies. 
The  government  has  expended  hundreds  of  thousands  of 
pounds  for  races  to  supply  water  to  the  miners.  It  gets 
but  small  returns  on  this  directly,  but  public  enterprise  has 
a  broader  basis  than  immediate  profit.  Counting  in  the 
sums  received  from  miners  for  miners'  rights  and  the  gold 
duty  and  the  amount  of  general  taxes  paid  by  the  miners 
it  has  been  figured  in  certain  cases  that  the  amount  appro- 
priated for  this  industry  really  pays  nearly  five  per  cent,  a 
year  profit,  and  public  opinion  in  New  Zealand  sustains  the 
expenditure  as  a  whole  as  highly  desirable  for  the  general 
good.  In  1897  the  state  appropriated  $50,000  for  the  pur- 
chase of  a  cyanide  patent  for  the  reduction  of  refractory 
ores  in  order  to  throw  it  open  to  the  public  at  reasonable 
rates. 


334        GOVERNMENT  &  CO.,  UNLIMITED 

New  South  Wales  pays  miners  a  certain  bonus  for  every 
foot  they  go  down.  This  is  usually  expected  to  amount 
to  about  half  the  cost  of  sinking  the  prospect  hole.  If  the 
prospect  is  a  failure  it  saves  thousands  of  dollars  that  would 
have  been  spent  in  the  neighbourhood  by  others,  and  if  one 
prospect  in  many  proves  to  be  a  strike  the  colony  is  amply 
repaid. 

New  South  Wales  also  reduces  ore  experimentally  for 
the  public.  It  will  apply  every  process  necessary  to  deter- 
mine its  value  and  the  proper  way  of  treating  it,  and  for  this 
it  makes  a  small  charge.  This  is  a  work,  as  Minister  Mc- 
Lachlan  explained  to  me,  which  private  industry  could  not 
undertake  in  the  present  state  of  development  of  New  South 
Wales.  The  individual  miner  could  not  find  out  what  to 
do.  He  would  probably  buy  the  wrong  machinery  or  go 
in  for  the  wrong  process. 

The  huge  water-pipe  (of  American  manufacture)  which 
has  been  laid  by  Western  Australia  to  the  gold  mines  of 
the  Coolgardie  district  is  one  of  the  mining  wonders  of  the 
world.  Queensland,  in  aid  of  deep  mining,  will  advance 
pound  for  pound  on  the  expenditure  by  private  parties,  pro- 
vided the  experiment  has  the  approval  of  the  state  geolo- 
gist. In  aid  of  ordinary  prospecting  it  will  advance  ten 
shillings  a  week  to  each  man. 

The  following  is  a  specimen  of  the  kind  of  "political" 
news  which  one  finds  in  the  New  Zealand  papers : 

"The  Agricultural  Department  has  decided  to  make  its 
first  shipment  of  poultry  to  London  in  February.  The  de- 
partment has  arranged  to  kill  and  dress  all  birds  sent  to 
the  depots,  to  be  established  at  each  of  the  four  chief  ports, 
and  it  will  also  be  willing  to  send  them  to  the  home  mar- 
ket at  the  risk  of  the  owners.  A  small  charge  will  be 
made  for  killing,  dressing  and  packing.  The  cost  of  ship- 
ping the  birds  to  London  will  be  equally  reasonable." 


NO  MORE  PILGRIM  FATHERS  335 

The  people  do  not  take  this  kind  of  thing  as  in  any  way 
a  favour  or  privilege.  No  such  idea  of  the  relation  between 
himself  and  his  government  ever  enters  the  mind  of  the 
New  Zealander.  He  is  the  government,  and  he  expects  it 
to  do  what  he  wants  as  if  it  were  his  hand. 

I  read  in  my  morning  paper  of  Christchurch : 

"Considerable  feeling  was  shown  at  the  meeting  at 
Marshlands  last  night  with  respect  to  the  failure  of  the  De- 
partment of  Agriculture  to  fulfil  their  promise  to  send  a 
trial  shipment  of  onions  to  England." 

And  of  course  a  deputation  was  appointed  to  call  the 
department  to  account. 

All  this  seems  to  be  a  good  illustration  of  the  origin  of 
all  the  Australasian  "socialisms."  They  have  been  the 
natural  recourse  of  a  new  people  coming  into  existence  in 
the  midst  of  the  modern  complex  industrial  system.  Al- 
though in  a  new  land  the  Australasians  found  themselves 
compelled  to  produce  for  the  world's  markets  in  sharp  com- 
petition with  the  people  of  all  other  countries.  They  must 
pay  interest  and  must  buy  expensive  machinery  and  must 
live  expensively.  From  every  quarter  of  the  globe  other 
peoples  are  pouring  products  into  the  markets,  with  the  help 
of  the  reaper,  the  binder,  the  railroad,  and  all  the  other 
now-a-day  processes. 

The  primitive  age  of  colonisation  is  past — the  Robinson 
Crusoe  age.  With  the  natural  shrewdness  of  the  Anglo- 
Saxon,  the  Australasians  have  recognised  this  and  have 
borrowed  abroad  and  socialised  at  home.  Colonisation  in 
this  age  of  the  world  cannot  be  the  Pilgrim  Father  thing  it 
was  one  hundred  years  ago. 

One  of  the  trusts  or  monopolies  in  New  Zealand  is 
the  "shipping  ring,"  which  has  drawn  a  cordon  of  high  rates 
and  poor  service  between  New  Zealand  and  the  rest  of  the 
world.  The  people  complain  of  this  bitterly,  for  it  produces 


336         GOVERNMENT  &  CO.,  UNLIMITED 

some  results  very  characteristic  of  monopoly.  Coal  is  very 
dear  in  Wellington — $9.25  a  ton — because  by  some  sort  of 
"an  agreement  between  gentlemen"  the  steamers  from  Aus- 
tralia do  not  bring  in  the  cheap  coal  of  that  colony,  and 
the  New  Zealanders  are  left  to  the  tender  mercies  of  the 
steamship  company  in  control  of  their  country,  which  also 
by  a  happy  coincidence — happy  for  it — owns  the  princi- 
pal coal  mines  in  addition  to  the  steamers.  Its  freight 
rate  from  the  New  Zealand  mines  to  the  New  Zealand  mar- 
ket is  twice  as  much  as  that  for  bringing  coal  from  New 
South  Wales,  several  times  as  far. 

An  excursion  to  the  Sounds  of  the  West  Coast,  which 
are  more  beautiful  than  the  fiords  of  Norway,  is  made  every 
year  by  the  steamers  of  this  monopoly.  The  owners  of  a 
boat  not  belonging  to  this  combination,  thinking  the  sea  was 
free  and  that  they  might  as  well  make  a  little  money  in  a 
dull  season,  advertised  to  carry  tourists  to  Milford  Sound. 
At  this  they  were  promptly  notified  by  the  monopoly  that  if 
they  persisted  in  this  invasion  of  "our  field,"  it  would  at 
once  put  on  a  boat  to  compete  with  them  in  their  own  ter- 
ritory. 

There  are  constant  complaints  from  shippers  of  prod- 
uce abroad  of  their  treatment  by  the  transportation  com- 
panies, both  as  to  rates  and  accommodations.  The  New 
Zealand  government  is  continually  interfering  in  their  be- 
half and  frequently  secures  important  reductions.  It  has 
also  subsidised  steamers,  but  that  has  not  worked  satisfac- 
torily. It  cannot  always  see  that  full  cargoes  are  ready, 
but  the  subsidised  boats  demand  full  pay  nevertheless. 

The  Agricultural  Department  is  now  asking  Parliament 
for  power  to  enter  into  contracts  with  steamship  companies 
in  behalf  of  the  producer.  Premier  Seddon,  in  his  speeches 
during  the  last  campaign,  gave  frequent  instances  of  the 
active  and  successful  intervention  of  the  Ministry  in  behalf 


STATE   STEAMERS,  MINES  AND  STORES  337 

of  better  freight  rates  for  the  producers.  As  one  item,  it 
succeeded  in  getting  the  freights  on  flax  reduced  by  £3  a  ton. 

In  opening  the  annual  show  at  Dunedin,  in  1899,  the  Pre- 
mier stated  that  he  had  been  negotiating  successfully  for 
steamship  communication  with  the  Cape  and  even  beyond, 
to  India.  In  a  speech  just  before  the  November  election, 
1899,  he  said,  referring  to  his  success  in  breaking  down 
the  former  monopoly  and  reducing  freight  rates,  that,  if 
the  steamship  companies  attempted  to  get  the  same  rates 
as  formerly,  he  would  stump  New  Zealand  from  end  to 
end,  and  the  result  would  be  a  line  of  government  steamers 
for  the  carriage  of  New  Zealand  produce. 

The  price  of  coal  in  New  Zealand  was  the  subject  of  a 
Parliamentary  investigation  in  1899.  It  was  found  that  the 
"shipping  ring"  was  complete  and  that  there  was  no  com- 
petition. The  Various  ports  were  apportioned  out  among 
the  different  companies,  like  Roman  provinces.  Twice  as 
much  was  charged  for  the  shipment  of  coal  to  intermediate 
ports  as  to  the  principal  markets  like  Wellington.  The 
committee  found  that  the  price  of  coal  could  be  reduced 
materially  without  any  interference  with  the  wages  of  the 
miners  or  the  legitimate  profits  of  the  trade. 

Besides  suggesting  some  minor  reforms  the  committee 
recommended  "that  the  government  take  into  consideration 
the  advisability  of  procuring  steamers  for  the  purpose  of 
conveying  coal  purchased  by  the  government  at  the  port  of 
shipment,"  and  the  "opening  of  retail  agencies  under  state 
control."  The  Opposition  laughed  at  the  idea  that  the  state 
go  into  the  coal  business  "as  a  huge  joke,"  but  the  Premier 
took  quite  a  different  view  of  it.  In  the  debate  on  the  re- 
port he  said,  "The  state  can  get  screened  coal  for  its  rail- 
ways at  less  than  $5.00  a  ton,  and  why  should  the  working- 
men  have  to  pay  $10.00  a  ton?  It  will  pay  the  state  to  buy 
coal  at  those  rates  and  retail  it  from  depots  at  $6.25  a  ton." 


338        GOVERNMENT  &  CO.,  UNLIMITED 

The  Premier  was  not  afraid  to  point  out  where  the  policy 
which  began  in  the  purchase  of  coal  must  end. 

"The  time  is  not  far  distant,"  he  said,  "when  the  state 
will  be  working  its  own  coal  mines.  I  do  not  see  why  it 
should  not  do  that  as  successfully  as  it  works  the  railways." 

Later,  in  a  public  speech  dealing  with  future  legislation, 
the  Premier  announced  his  intention  of  promoting  a  bill  to 
fix  the  maximum  price  to  be  charged  for  coal.  At  the  same 
time  he  promised  a  bill  to  regulate  the  rents  for  poor 
shopkeepers  who  were  unable  openly  to  take  part  in  political 
organisations  because  of  the  pressure  of  their  richer  cus- 
tomers. Evidently  the  people  regard  Premier  Seddon's 
programme  with  favour.  In  the  election  which  soon  fol- 
lowed,— in  November,  1899, — he  and  his  party  were  re- 
turned to  power,  for  the  third  time  consecutively,  and  with 
a  larger  majority  than  ever. 

The  old,  too  old,  world  is  sterilising  its  wealth,  its  life, 
by  the  political  economy  of  hell,  into  the  deaths  and  debts 
and  despotisms  of  war.  The  living  capital  of  the  interna- 
tional money  markets  that  would  reproduce  itself  in  ever 
more  and  more  harvests,  commodities  and  homes  we  are 
changing  into  dead  capital  —  armaments,  soldier  boys' 
graves  and  billions  of  government  bonds  to  mortgage  the 
many  to  the  few  for  all  time.  But  of  the  $40,000,000  in- 
crease in  the  New  Zealand  debt  since  1891,  $31,000,000 
went  into  peopling  the  land,  and  railways,  harbours,  ad- 
vances to  settlers,  etc.  It  costs  $1,092,565  a  year  in  inter- 
est, and  earns  $1,434,350.  Eight  of  the  other  nine  millions 
were  spent  for  land  and  public  works.  Most  of  the  last 
million  was  for  debt  refunding.  Of  th'e  Australasian  na- 
tional debts  of  $1,064,859,095  in  1897,  $907,389,505  stand 
for  railroads,  water,  sewerage,  telegraphs,  bridges,  har- 
bours, immigration,  and  most  of  the  remainder — for  "other 
works  and  services" — is  equally  fertile. 


CHAPTER  XIV 

PENSIONS    FOR   VETERANS    OF    WORK 

IN  the  post-offices  everywhere  throughout  New  Zealand 
one  sees  on  the  walls  a  notice  headed : 

"OLD-AGE  PENSIONS," 

giving  directions  for  obtaining  the  forms  with  which  appli- 
cations for  pensions  must  be  made,  and  telling  what  to  do 
with  them. 

The  post-office  is  used  extensively  in  the  machinery  of 
the  old-age  pension  office.  It  supplies  applicants  with  the 
necessary  papers,  forwards  them,  and  receives  from  the 
Treasury  and  distributes  every  month  the  payments  made  to 
those  who  become  pensioners. 

New  Zealand  is  the  first  country,  and  so  far  the  only 
country,  to  pay  old-age  pensions  out  of  the  proceeds  of  gen- 
eral taxation. 

Denmark  began  the  payment  of  old-age  pensions  in  1892, 
but  there  the  funds  are  contributed  only  in  part  by  the  na- 
tion, which  obtains  them  from  drinkers,  through  a  tax  on 
beer. 

In  New  Zealand  every  taxpayer  contributes,  since  the 
money  for  old-age  pensions  is  taken  out  of  the  consolidated 
revenue.  In  Denmark  the  "total  abstainers"  have  no  other 
national  part  in  this  measure  of  justice  or  generosity  than 
to  tax  it  out  of  the  non-abstainers. 

339 


The  first  payment  of  pensions  under  the  law  was  made  to 
the  successful  applicants  shortly  after  my  arrival  in  Christ- 
church.  Punctually  upon  the  opening  of  the  door  at  nine 
o'clock  the  little  corner  of  the  office  in  the  Post-Office  Sav- 
ings Bank  Department  set  apart  for  this  payment  was  filled 
with  old  men  and  women.  Entering  with  anticipation  and 
not  infrequently  anxiety  on  their  faces  they  came  out  in 
happier  mood. 

The  measure  was  denounced  in  Parliament  as  one  that 
would  be  invoked  only  by  paupers  and  loafers,  by  the  disso- 
lute and  the  drunken.  But  no  such  words  would  fit  the  old 
and  forlorn  men  and  women  I  saw  in  the  magistrate's  courts 
undergoing  examinations  for  pension  allowance.  There 
were  signs  of  self-indulgence  on  the  faces  of  some,  but  the 
great  majority  bore  only  the  scars  of  suffering,  privation 
and  failure.  Out  of  fifty  or  more,  I  saw  only  one  who  could 
have  sat  for  the  portrait  thus  drawn  by  the  opponents  of  the 
bill,  and  he  was  peremptorily  rejected. 

Woman  suffrage  came  in  New  Zealand  almost  without 
notice  and  without  agitation.  Old-age  pensions  were  dis- 
cussed in  and  out  of  the  New  Zealand  Parliament  for  sev- 
eral years.  Woman  suffrage  has  cured  no  old  problems, 
and,  so  far,  has  created  no  new  ones.  A  slightly  larger 
percentage  of  women  than  of  men  exercise  their  right  of 
voting.  The  influence  of  women  has  been  felt  helpfully  in 
legislation;  it  was  due  to  this  that  instead  of  being  abso- 
lutely forfeited  the  stipend  of  an  old-age  pensioner  convicted 
of  drunkenness  or  other  minor  offences  has  been  made  pay- 
able to  his  wife  or  some  guardian. 

As  early  as  1892  Dr.  Duncan  McGregor,  who  is  at  the 
head  of  the  charities  of  New  Zealand,  urged  some  substi- 
tute for  the  relief  given  by  the  charitable-aid  boards.  He 
pointed  out  that  the  drift  of  legislation  and  debate  in  Ger- 
many, Denmark,  England  and  other  countries  indicated 


THE  CONSERVATIVE  IF  341 

the  rise  of  a  strong  public  sentiment  "in  favour  of  a  more 
sympathetic,  discriminating  treatment  of  the  aged  poor. 
The  idea  is  that  the  respectable  poor  ought  not  to  be  treated 
as  thriftless  spongers  and  broken-down  drunkards,  but 
rather  as  worn-out  soldiers  who  have  deserved  well  of  their 
country.  Our  unjust  system  of  distributing  the  proceeds 
of  labour,  it  is  argued,  must  compel  society  to  face  the  duty 
of  making  such  provision  for  deserving  old  age  as  shall 
not  involve  any  sacrifice  of  self-respect  in  accepting  it." 

The  Progressive  Liberal  Association,  which  has  been  the 
source  of  much  of  the  energy  that  is  actualising  itself  in 
New  Zealand  legislation,  took  up  old-age  pensions.  Like 
the  head  of  the  Department  of  Charities,  it  emphasised  the 
argument  that  something  better  than  poor  relief  was  due  the 
victims  of  our  "system  of  cut-throat  competition."  These 
radicals,  however,  insisted  and  still  insist  that  pensions 
should  be  made  universal,  so  as  to  avoid  all  suggestion  of 
pauperism  in  the  recipient,  and  the  same  demand  was  made 
by  the  Trade  and  Labour  Conference  of  the  New  Zealand 
trades-unions  in  1900. 

In  the  elections  of  1897  candidates  for  Parliament  were 
asked  everywhere  throughout  the  colony  whether  they  were 
in  favour  of  old-age  pensions,  and  they  almost  always  an- 
swered that  they  were,  the  Conservatives  adding,  "if"  any 
way  could  be  devised  for  making  them  practicable. 

The  "squire"  class,  which  foresaw  increased  taxation  for 
their  lands,  incomes  and  inheritances — and  this,  indeed,  the 
friends  of  the  scheme  freely  promised  them — fought  it  most 
bitterly.  Their  first  move  was  an  attempt  to  convert  it 
either  into  a  compulsory  insurance  fund,  in  which  no  one 
should  share  who  had  not  previously  contributed,  as  had 
been  done  in  Germany,  or  to  make  it  universal — which  is 
now  the  favourite  English  checkmate  for  this  reform. 

Discussion  led  to  a  decisive  rejection  of  the  universal  and 


342    PENSIONS  FOR  VETERANS  OF  WORK 

contributory  features.  To  the  argument  for  restricting  pen- 
sions to  those  who  contributed,  Premier  Seddon  replied: 

"All  our  aged  colonists  have  contributed;  they  have  con- 
tributed large  sums  to  the  colony's  revenue." 

He  pointed  out  that  property  throughout  the  colony  had 
been  greatly  enhanced  in  value,  sometimes  one  thousand  per 
cent.,  by  the  railroads  and  other  public  works  built  by  the 
expenditure  of  public  moneys,  the  interest  on  which  these 
old  colonists  had  helped  to  pay. 

No  contributory  scheme,  again,  could  meet  the  needs  of 
those  for  whom  immediate  relief  was  demanded.  They 
could  not  contribute.  "The  days  of  their  youth  and  the 
days  of  their  earnings  are  gone,"  the  Premier  said. 

The  case  for  these  contributors  is  summed  up  in  the  pre- 
amble of  the  law : 

"Whereas,  it  is  equitable  that  deserving  persons,  wllo 
during  the  prime  of  life  have  helped  to  bear  the  public 
burdens  of  the  colony  by  the  payment  of  taxes  and  to  open 
up  its  resources  by  their  labour  and  skill,  should  receive 
from  the  colony  a  pension  in  their  old  age.  Be  it  therefore 
enacted." 

Great  support  came  to  the  bill  from  the  undeniable  fact 
that  many  of  the  pioneers  of  New  Zealand,  men  and  women 
who  had  built  their  youth  into  its  wealth  and  progress,  had 
failed,  from  sickness,  miscalculations,  the  rascality  or  weak- 
ness of  others,  to  share  in  that  prosperity.  It  was  felt  to 
be  a  cruel  mockery  to  print  "glowing  lives"  of  these  pio- 
neers in  the  newspapers,  and  glorify  them  in  anniversaries 
and  semi-centennial  celebrations,  and  still  leave  them  suffer- 
ing, as  many  were,  for  the  bare  necessaries  of  life. 

How  entirely  New  Zealand,  with  all  its  advantages,  is  in 
the  same  economic  current  as  the  rest  of  the  world,  with 
the  same  problems  and  disabilities  in  kind,  if  not  in  degree, 
was  shown  in  the  debate  by  the  Honourable  J.  G.  Ward. 


THE   ARGUMENT   FOR   THRIFT  343 

"The  vast  majority  of  our  workingmen,"  he  said,  "are 
casual  labourers.  They  have  no  certainty  from  day  to  day 
of  their  incomes ;  they  have  a  positive  certainty  only  of  their 
outgoings." 

The  stock  argument  that  these  workingmen  should  prac- 
tise thrift  and  pension  themselves  was  answered  by  one  of 
the  members  of  Parliament. 

"I  should  like  to  know,"  he  asked,  "whether  the  honour- 
able member  has  ever  visited  the  homes  where  workingmen 
are  endeavouring  to  support  their  families  on  six  shillings 
a  day,  and  even  then  their  work  intermittent.  Out  of  that 
six  shillings  a  day  one  third  has  to  go  to  rent.  They  have 
to  keep  their  families  out  of  the  small  residuum  after  the 
landlord  exacts  his  dues.  He  would  find  in  these  homes 
hungry  children,  women  at  the  wash-tub,  frugal  meals  and 
very  few  luxuries.  I  would  like  the  honourable  member 
for  Wellington  City  to  go  into  these  homes — and  they  are 
numerous  in  the  city  from  which  he  comes — and  tell  those 
inmates,  'You  must  practise  thrift.'  Thrift  out  of  four 
shillings  a  day,  with  perhaps  eight  or  nine  mouths  to  feed, 
clothes  to  find,  boots  for  their  feet  and  books  for  their  school ! 
Thrift  on  the  miserable  wages  that  some  of  the  employers 
of  labour  give  to  their  young  men  because  they  will  not  keep 
old  men,  nor  will  they  keep  married  men,  some  of  them !" 

That  this  was  a  true  revelation  of  the  New  Zealand  eco- 
nomic situation  was  confessed  in  conversation  by  the  head  of 
the  Public  Trust  office.  How  can  a  workingman,  he  said 
in  substance,  who  works  hard  and  raises  eight  or  ten  chil- 
dren, feeding,  clothing  and  educating  them,  housing  them 
decently,  lay  by  anything  for  a  rainy  day  or  old  age?  He 
cannot,  and  so  we  give  him  an  old-age  pension. 

"If  such  a  man,"  one  of  the  New  Zealand  radicals  to 
whom  I  quoted  this  remark  said,  "cannot,  like  the  ant  or 
beaver,  gain  a  store  for  his  winter  of  life,  there  is  something 


344    PENSIONS  FOR  VETERANS  OF  WORK 

'rotten  in  Denmark.'  To  burn  him  out  before  his  time,  cre- 
ating the  wealth  of  which  the  state  boasts  in  its  Year  Book, 
and  then  invite  him  to  act  the  part  of  a  happy  old  age  on  a 
shilling  a  day,  seven  shillings  a  week,  when  even  the  ordi- 
nary workingman  has  to  pay  fifteen  shillings  a  week  for 
his  'tucker/  is  pretty  poor  charity  and  no  justice  at  all." 

It  was  on  this  ground — that  the  workingman  cannot  be 
sure  of  making  his  own  provision  for  old  age — that  the 
last  English  Trades-Union  Congress  voted  for  an  old-age 
pension  law.  Their  resolution  favoured  pensions  at  sixty 
years  of  age,  or — a  very  important  improvement  on  the  New 
Zealand  law — at  the  date  of  becoming  incapacitated. 

The  desperation  of  the  opponents  of  the  bill  was  fed  by 
the  forecast  its  supporters  gave  as  to  how  they  expected  to 
raise  the  money.  The  Premier's  chief  supporter  in  the  de- 
bate, the  Honourable  J.  G.  Ward,  who  had  been  Colonial 
Treasurer,  predicted  that  the  old-age  pensions  would  be- 
come so  popular  that  the  people  would  insist  that  the  funds 
to  meet  them  be  made  sure  by  having  certain  taxes  "ear- 
marked" for  them.  They  would  not  be  content  to  have 
them  left  merely  as  a  charge  on  the  general  revenue,  for  that 
would  put  them  at  the  mercy  of  a  panic  with  its  deficit,  or  a 
careless  appropriation  bill.  He  said  that  "certain  classes 
of  luxuries  now  imported  through  the  customs  could  and 
should  be  specially  earmarked"  to  provide  funds  to  place 
the  old-age  pensions  beyond  the  possibility  of  failure.  He 
thought,  too,  the  graduated  land-tax  might  be  "earmarked" 
for  the  same  purpose.  Old-age  pensions,  he  declared,  would 
be  continued  by  the  people  of  New  Zealand,  and  would  go 
much  further  than  in  the  pending  law. 

The  opposition  was  the  most  determined,  not  to  say  viru- 
lent, that  has  been  encountered  by  any  of  the  advanced  pro- 
posals of  the  present  administration  of  New  Zealand  during 
its  ten  years  of  office.  Over  nine  hundred  speeches  were 


A   STONE  WALL  345 

delivered  against  the  bill  as  first  proposed,  and  over  four- 
teen hundred  against  it  when  submitted  to  Parliament  the 
last  time.  Obstruction  went  to  the  extremest  lengths  that 
could  be  devised.  Single  members  of  the  Opposition  made 
as  many  as  one  hundred  speeches  against  it,  saying  anything 
and  everything  that  could  consume  time  so  as  to  break  down 
•even  the  physical  strength  of  the  government  majority. 
This  sort  of  tactics  is  called  a  "stone  wall"  in  New  Zealand, 
and  to  meet  it  the  Premier  and  his  supporters,  refusing  to 
adjourn,  sustained  the  strain  of  a  continuous  session  from 
Wednesday  till  Saturday  night,  when  the  Opposition  finally 
gave  way,  and  the  bill  was  passed  by  a  handsome  ma- 
jority. 

The  backbone  of  this  resistance  came  from  those  who 
saw  that  in  a  not  distant  future  their  "unearned  increment" 
would  be  taxed  heavily  to  provide  money  to  sweeten  the 
lot  of  the  old  age  which  had  helped  to  create  it. 

"Those  best  able  to  bear  it,"  Mr.  Ward  had  said  frankly, 
"will  have  to  contribute  in  proportion  to  their  income  and 
their  position  to  this  old-age  pension  fund." 

To  those  who  objected  to  the  principle  of  the  bill  the 
Premier  gave  this  reply : 

"Some  years  ago  when  a  quarter  of  a  million  was  asked 
because  Providence  had  sent  disastrous  snow  storms  in  the 
North  Otago  and  Canterbury  districts,  destroying  large 
quantities  of  stock  and  causing  much  loss  to  the  flock  own- 
ers, this  Parliament  passed  legislation  in  two  days  which 
gave  relief  to  that  extent.  We  allowed  a  reduction  to  the 
extent  of  £400,  $2000,  a  year  in  some  cases  to  our  Crown 
tenants.  As  disaster  had  overtaken  them  we  relieved  them 
of  their  obligations.  Disaster  has  overtaken  many  of  the 
aged  of  our  colony ;  they  have  fallen  in  the  industrial  strug- 
gle. The  state  has  a  perfect  right  to  relieve  them  by  grant- 
ing them  pensions." 


346    PENSIONS  FOR  VETERANS  OF  WORK 

This  was  the  last  word  of  the  debate,  and  the  bill  then 
became  a  law  by  a  vote  of  twenty-five  to  fifteen.  This  was 
in  1898.  The  law  was  limited  to  three  years,  as  so  new  a 
policy  would  by  that  time  need  amendment.  The  over- 
whelmingly Liberal  cast  of  the  new  Parliament  which  meets 
in  1900  makes  re-enactment  certain.  This  law  in  New 
Zealand  comes,  after  one  hundred  and  two  years,  to  realise 
the  scheme  broached  by  Tom  Paine  in  a  pamphlet  pub- 
lished by  him  in  1796.  Under  the  title  of  "Agrarian  Jus- 
tice" he  proposed  that  every  nation  should  create  a  fund 
to  pay  to  every  one  upon  arriving  at  the  age  of  twenty-one 
the  sum  of  £15  to  begin  the  world  with,  and  to  pay  also 
£10  a  year  for  life  to  every  person  of  the  age  of  fifty  years, 
"to  enable  them  to  live  in  old  age  without  wretchedness, 
and  go  decently  out  of  the  world." 

Through  the  courtesy  of  Stipendiary  Magistrate  H.  Eyre 
Kenney,  I  sat  by  his  side  on  the  bench  one  morning  in  Well- 
ington during  his  examination  of  thirty  or  forty  old  men 
and  women.  As  the  proceedings  went  on  he  explained  to 
me  the  details  of  the  law. 

Any  one  over  sixty-five  is  entitled  to  a  pension,  if  other- 
wise qualified  as  specified  by  the  law.  Within  certain  limits 
of  time  there  must  have  been  no  dishonourable  imprison- 
ment, no  desertion  of  husband  or  wife  or  children,  and  for 
the  last  five  years  there  must  have  been  a  sober  and  repu- 
table life. 

y,  The  Denmark  law  separates  the  deserving  poor  from  the 
'  undeserving  poor.  The  title  of  the  New  Zealand  act  limits  it 
to  "deserving  persons,"  but  the  New  Zealand  interpretation 
of  deserving  is  much  more  generous  than  that  of  Denmark. 
In  Denmark  no  one  who  has  ever  undergone  sentence  for 
any  dishonourable  transaction  or  whose  poverty  is  caused 
by  his  having  been  a  spendthrift  or  who  has  received  poor 
relief  can  have  a  pension. 


THE   PEOPLE   FORGIVE  347 

.%  But  New  Zealand  forgives  the  sins  of  the  thriftless,  the 
vicious,  and  even  the  criminal.  This  Christian  spirit  of 
democracy  was  voiced  by  the  Honourable  J.  G.  Ward  in 
the  debate.  "Those  who  fall,"  he  said,  "may  mend.  For- 
tunately the  great  mass  of  the  people  possess  the  spirit  of 
forgiveness."  One  may  become  a  pensioner  who  has  been 
drunk  and  disreputable,  provided  that  these  eccentricities  of 
conduct  have  not  been  in  evidence  for  five  years  previously. 
One  may  have  been  in  prison  for  five  years  for  a  dishonour- 
able crime,  and  still  be  eligible  if  the  imprisonment  was 
twenty-five  years  before.  He  may  have  been  imprisoned  for 
four  months  four  times  for  offences  punishable  by  twelve 
months'  imprisonment  and  still  be  eligible  for  a  pension  if 
his  incarceration  is  twelve  years  past.  V 

To  be  poor  in  New  Zealand  is  evidently  the  largest  part 
of  the  qualification  of  "deserving."  If  a  man. or  woman  has 
been  a  citizen  and  resident  for  twenty-five  years  the  pension 
is  given  as  a  right,  subject  to  the  stipulations  just  described. 
In  other  words,  if  the  sheet  is  clean  of  drunkenness  and  idle- 
ness for  five  years,  of  minor  offences  for  twelve  years,  and 
of  the  most  serious  ones  for  twenty-five  years  the  pension 
will  be  given,  no  matter  how  black  may  have  been  the  pre- 
vious record.  As  usually  inculcated,  love  of  country  is  love 
that  goes  to  one's  country.  Here  is  love  of  country  from 
one's  country. 

In  New  Zealand,  as  in  Denmark,  the  pension  is  forfeit- 
able.  The  forfeiture  of  the  pension  is  absolute  upon  con- 
viction for  twelve  months  or  more  for  any  offence  "dis- 
honouring in  the  public  estimation,"  or  for  conviction  of 
habitual  drunkenness.  Instructions  while  I  was  there  were 
issued  by  the  Commissioner  of  Police  to  the  police  through- 
out the  colony  to  report  on  all  cases  where  pensioners  squan- 
der their  pensions  on  drink,  and  not  to  wait  until  the  pen- 
sioners had  been  convicted  of  drunkenness.  The  forfeiture 


348    PENSIONS  FOR  VETERANS  OF  WORK 

is  discretionary  if  the  pensioner  has  been  convicted  only  of  a 
minor  offence,  and  also  if  he  is  wasting  his  pension,  injuring 
his  health,  or  disturbing  the  happiness  of  his  family.  In 
such  a  case  the  pension  may  be  paid  to  his  wife  or  some 
one  else  for  the  family  benefit.  The  latter  stipulation  is 
to  be  credited  to  the  influence  of  the  women  and  the  fran- 
chise which  has  enabled  them  to  give  political  effect  to  that 
influence. 

The  pensions  are  awarded  only  for  a  year.  At  the  end 
of  each  year  the  pensioner  must  again  make  application  and 
must  undergo  examination.  There  can  be  no  doubt  that 
this  ordeal  of  examination,  yearly  repeated,  keeps  away 
some  of  the  more  sensitive. 

In  New  Zealand,  as  in  Denmark,  pensioners  are  not  dis- 
franchised, as  are  the  recipients  of  poor  relief  in  England. 
To  receive  an  old-age  pension  it  is  not  necessary  to  be  a 
pauper.  Any  one  with  an  income  short  of  £52  ($260)  a 
year,  or  with  property  of  less  than  £270  ($1350)  may  re- 
ceive a  pension.  The  full  pension  is  £18  a  year,  payable 
monthly,  but  no  one  can  receive  as  much  as  this  who  has  a 
larger  income  than  £34  a  year  or  property  worth  more  than 
£50  in  excess  of  incumbrances.  For  every  pound  of  in- 
come over  £34,  one  pound  is  deducted  from  the  amount  of 
the  pension.  In  like  manner  for  each  £15  of  accumulated 
property  above  £50  in  value,  after  subtracting  any  mortgage, 
one  pound  is  deducted. 

The  ideal  of  the  law  is  that  the  worn-out  veterans  of 
work  shall,  with  the  help  of  the  state,  have  an  income,  if 
possible,  of  £52  a  year.  To  such  a  one,  therefore,  who 
already  possesses  £34  of  income  the  state  pays  £18  more, 
making  the  £52,  which  is  the  minimum  set  by  New  Zea- 
land as  the  income  which  it  thinks  the  old  soldiers  of  the 
industrial  army  should  have. 

The  court  room  on  the  morning  of  my  attendance  was 


INDUSTRIAL   WRECKAGE  349 

filled  with  a  pathetic  crowd  of  men  and  women,  ruined 
hulks,  flotsam  and  jetsam  of  the  work-a-day  life  of  New 
Zealand.  Some  were  from  one  of  the  benevolent  homes 
which  are  maintained  by  the  colony  for  the  relief  of  its 
aged  poor.  These  are  not  barred  from  receiving  pensions, 
and  they  are  also  allowed  to  remain  in  the  institutions  if 
they  desire,  but  in  such  cases  the  trustees  appropriate  part 
or  all  of  the  pension  to  pay  for  their  keep. 

There  were  old  soldiers — in  another  court  one  of  the  ap- 
plicants was  an  Eighteenth  Royal  Irishman,  who  wore  a 
Crimean  medal,  with  clasps  for  Alma,  Inkerman  and  Sebas- 
topol,  and  also  Turkish  and  New  Zealand  medals — miners, 
sailors,  workingmen,  and  wives  and  widows  of  the  same 
classes.  The  examinations  proceeded  rapidly,  from  two  to 
four  minutes  being  taken  up  with  each  case.  Sometimes 
husbands  and  wives  were  present  together,  and  if  their  cases 
fulfilled  the  requirements  of  the  law  each  went  away  happy 
with  his  allowance  of  a  full  pension  of  £18  each.  An  officer 
of  the  home  was  in  attendance  for  the  purposes  of  assisting 
the  judge  in  the  examination  of  its  inmates. 

One  applicant  was  receiving  six  shillings  a  week  from 
this  benevolent  home.  He  was  allowed  a  pension  of  £18, 
$90,  a  year,  or  seven  shillings  a  week. 

"The  home  will  now  reduce  his  allowance,"  the  judge 
said  to  me,  "or  take  it  away  altogether." 

John  Smith  was  an  old  soldier.  He  had  been  through 
the  Waikato  wars  and  had  seen  eight  years  of  rough  service. 
The  judge  looked  at  his  certificate  of  character. 

"You  have,"  he  said  benignantly,  "a  very  good  character 
indeed." 

The  old  man's  lips  trembled  and  his  eyes  filled  with  tears. 

Of  the  next,  a  brisk  little  old  man,  the  officer  from  the 
home  said : 

"This  is  one  of  those  men,  your  honour,  who  goes  away 


350    PENSIONS  FOR  VETERANS  OF  WORK 

for  several  months  in  the  summer  to  look  for  work  in  order 
to  take  himself  off  the  town.  He  is  the  most  independent 
man  in  the  world,  sir.  He  went  away  last  summer  as  usual, 
but  had  to  come  back  since  he  could  find  nothing  to  do." 

Of  another  the  officer  said : 

"He  is  an  industrious  man  when  able  to  get  work,  and 
when  at  the  home  he  looks  after  its  washing." 

Some  novel  questions  arise  between  the  inmates  of  the 
benevolent  homes  who  receive  pensions  and  the  authori- 
ties. In  one  case,  at  Taranaki,  the  inmates  who  received  pen- 
sions took  up  the  position  that  they  were  not  paupers,  since 
they  paid  the  board  for  their  keep,  and  therefore  they  struck 
against  the  regulation  requiring  them  to  work.  This  kind 
of  strike  is  not  covered  by  the  compulsory  arbitration  law. 

In  one  home  some  of  the  inmates  had  transferred  their 
real  estate  to  the  charitable  aid  board.  When  subsequently 
they  were  granted  pensions  they  asked  the  board  to  continue 
making  them  the  usual  grant  or  return  them  the  deeds  of 
their  property.  But  the  board,  while  deciding  that  it  would 
not  continue  the  charitable  aid,  since  they  were  now  getting 
old-age  pensions,  at  the  same  time  refused  to  return  the 
property  which  it  held  for  them.  It  was  afraid  that,  as  the 
pension  law  was  limited  to  1902,  it  might  not  be  renewed, 
and  the  old  people  would  come  again  on  its  hands.  The 
pensions  make  a  saving  in  some  districts  of  three  quarters 
of  the  sums  previously  spent  by  the  benevolent  homes. 

There  were  laughable  and  affecting  lapses  of  memory 
in  some  of  the  old  people.  One  could  not  remember  where 
he  had  registered  the  birth  of  his  last  child.  The  dates  of 
marriages  were  often  forgotten,  and  the  dates  of  arrival  in 
the  colony.  A  grave-digger  when  asked  as  to  his  income 
during  the  past  year  could  not  tell,  because  he  was  "paid 
by  the  piece,"  and  he  had  forgotten  how  many  there  had 
been.  His  case  was  adjourned  to  enable  him  to  find  out. 


NOT  THAT  KIND  OF  IMPRISONMENT    351 

There  were  one  or  two  who  were  too  sick  or  too  old  to 
come.  They  had  been  visited  by  an  officer  of  the  court, 
and  he  made  a  written  report  on  their  cases,  upon  which 
the  magistrate  acted  as  the  circumstances  required. 

An  old  woman  trimly  dressed,  with  red  cheeks  and  bright 
eyes,  took  the  stand  and  kissed  the  Bible  briskly.  They 
all  kissed  the  Bible,  an  unsanitary  proceeding  but  helpful 
to  the  finances  of  the  government  by  shortening  the  lives 
of  some  of  the  pensioners.  The  judge,  always  kind  in  his 
interrogation  of  these  unfortunate  people,  was  more  so  than 
usual  to  this  old  lady,  so  prepossessing  in  every  aspect. 

"I  am  obliged  to  ask  you,"  he  said — "the  law  compels 
me  to  do  so — if  you  have  ever  been  in  prison.  I  anticipate 
your  answer,"  he  added  encouragingly. 

The  papers  told  of  one  case  in  which  a  judge,  more  con- 
siderate even  than  Judge  Kenney,  hearing  the  case  of  an 
old  lady  whom  he  knew  to  be  of  irreproachable  character, 
tried  to  get  over  the  difficulty  of  asking  if  she  had  been  in 
prison  by  inquiring  in  an  off-hand  sort  of  way: 

"Have  you  ever  been  in  any  trouble  or  bother?" 

The  old  lady  beamed  on  the  bench  through  her  spectacles 
and  innocently  answered: 

"Well,  I  had  a  sprained  ankle  for  six  weeks  some  time 
back,  and  no  one  in  the  house  with  me." 

So  the  judge  had  to  repeat  his  question  in  the  stern  lan- 
guage of  the  act. 

One  of  the  old  men,  one  of  those  from  the  benevolent 
home,  when  asked  if  he  had  ever  been  in  prison,  replied  in 
an  ostentatiously  loud  voice,  "Yes,  for  thieving."  There- 
upon the  officer  from  the  home  explained  how  this  old  fel- 
low had  walked  off  in  the  clothes  given  him  by  the  insti- 
tution, and  had  been  brought  back  and  jailed,  just  to  make 
an  example  to  prevent  others  doing  likewise.  He  was  al- 
lowed the  full  pension. 


352    PENSIONS  FOR  VETERANS  OF  WORK 

Only  once  did  I  see  among  the  would-be  pensioners  any 
one  really  looking  disreputable.  He  was  a  vagrant  of  the 
most  undeniably  chronic  type.  He  admitted  cheerfully  that 
he  had  been  in  prison,  but,  he  urged,  "never  for  any  crim- 
inal offence."  He  had  been  turned  out  of  the  home  for 
drunkenness. 

"What  else  can  a  man  do,"  he  demanded,  "if  he  is  turned 
out,  but  turn  vagrant?" 

"I  shall  have  to  search  the  criminal  record,"  the  judge 
said.  The  man  stood  aside  while  the  court  officials  went 
to  look  him  up.  They  soon  returned  with  a  long  sheet  full 
of  a  formidable  list  of  convictions.  Some  of  them  were  for 
particularly  unsavoury  offences.  The  application  was  sum- 
marily rejected.  The  man  stepped  down  with  a  cheerful 
face,  apparently  as  clearly  satisfied  as  the  judge  that  he  had 
been  properly  rejected.  "That,"  he  said,  referring  to  his 
record  of  convictions,  "was  an  impediment,  I  knew;  but  as  I 
was  an  old  colonist  I  thought  I  might  as  well  make  the  ap- 
plication." After  this  applicant  had  thus  shown  the  cour- 
age of  his  "convictions"  one  of  the  old  naval  veterans  took 
the  stand.  Asked  the  question  about  prison,  he  replied,  "I 
have  never  been  in  prison  more  than  twice.  All  hands  went 
to  jail  in  1846  for  deserting." 

"That's  an  old  story,"  said  the  judge.  "The  law  does 
not  look  farther  back  than  twenty-five  years." 

When  the  pension  was  granted  some  thanked  the  judge, 
often  with  tears  in  their  eyes;  some  went  away  without  a 
word;  some  inquired  eagerly,  "How  will  I  get  it?"  and 
were  barely  satisfied  when  told. 

The  proceedings  were  quite  informal  in  their  manner, 
and  there  was  no  touch  of  sternness  to  confuse  the  poor 
creatures.  Everything  that  the  judge  could  do  by  tone, 
manner  and  suggestion  to  assist  them  to  recall  the  long- 
forgotten  details  of  age,  marriage,  income  was  done. 


A  WOMAN'S  AGE  353 

When  the  name  of  George  Nelson  was  called  the  officer 
in  attendance  informed  the  judge  that  he  had  died  since  his 
application  had  been  put  in. 

The  age  of  some  of  the  old  people  was  extraordinary. 
One  old  man-of-war's  man  was  ninety-six,  and  a  dame  ap- 
peared with  documentary  evidence  to  prove  that  she  was 
one  hundred  and  ten  years  of  age.  Sometimes  when  there 
was  no  other  proof  the  judge  settled  the  question  by  telling 
the  applicants  that  they  "looked  it."  This  was  perhaps  the 
only  occasion  on  which  I  ever  saw  a  woman  show  pleasure 
at  having  her  age  recognised. 

Family  Bibles  play  an  important  part  in  determining  ages. 
To  be  able  to  recollect  the  death  of  King  William  and  the 
accession  of  Queen  Victoria  is  a  card  which  the  pensioners 
like  to  be  able  to  play.  One  old  woman  declared  her  Bible 
was  too  big  to  bring  along.  She  was  sent  away  by  the 
judge  with  instructions  to  bring  it,  even  if  she  had  to  fetch 
it  in  a  wheelbarrow,  or  a  perambulator,  or  something. 

In  one  case  where  the  magistrate  asked  the  witness  how 
long  he  had  known  the  applicant,  the  witness  replied, 
"Eighty-one  years,  your  worship." 

"How  long?"  asked  the  astonished  magistrate. 

"Eighty-one  years,"  was  again  the  reply.  The  witness, 
who  was  eighty-six,  remembered  seeing  his  friend,  now 
eighty-two  years  of  age,  wheeled  about  "in  a  sort  of  box  on 
wheels  when  he  was  a  little  baby." 

A  full  pension  was  granted  to  a  man  one  hundred  and 
two  years  of  age.  Among  other  witnesses,  his  claim  was 
proved  by  a  daughter  aged  fifty-one,  who  said  that  she  had 
brothers  over  sixty.  This  hardy  old  man  had,  in  early  life, 
been  a  shepherd  in  the  Scottish  Highlands. 

An  old  settler  and  his  daughter  both  applied  for  pensions 
and  received  them.  The  father  was  ninety-five  years  of 
age,  and  the  daughter  over  sixty^five. 


354    PENSIONS  FOR  VETERANS  OF  WORK 

There  was  a  case  of  retribution,  long  delayed  but  sure. 
A  widow  in  her  application  had  stated  her  age  as  sixty- 
seven,  but  according  to  her  second-marriage  certificate, 
which  she  had  to  produce,  she  was  only  sixty-four.  The 
court  informed  her  that  she  could  not  be  sixty-four  to 
be  married  and  sixty-seven  to  be  pensioned  at  one  and  the 
same  time,  and  the  too  youthful  widow  was  told  to  wait. 

In  another  case  a  birth  certificate  tendered  in  evidence 
to  fix  the  age  of  a  woman  showed  to  the  quick  eye  of  the 
judge  an  alteration  in  one  of  the  figures.  The  deputy  wired 
to  the  district  officer  for  the  exact  figures.  The  informa- 
tion was  returned,  and  the  lady  lost  her  annuity. 

The  inquiries  as  to  property,  income,  money  in  the  sav- 
ings bank,  etc.,  were  always  thoroughly  made,  as  they  are 
required  to  be  by  the  law.  Many  had  incomes  and  owned 
property,  and  still  received  pensions  of  larger  or  smaller 
amounts.  Some  of  the  answers  were: 

"I  had  some  property  a  few  years  ago." 

"I  earn  about  seven  or  eight  pounds  a  year.  I  get  my 
keep  for  doing  light  work." 

"I  never  had  any  property  to  give  away  to  get  the 
pension." 

"No  income  at  all." 

"No  earnings  last  year.  I  earned  something  before  that 
as  a  nurse." 

"I  have  earned  no  money  for  two  years." 

"I  have  lived  on  my  children." 

"I  lost  what  I  had  through  sickness." 

"I  had  saved  some  money  and  have  been  living  on  that. 
Now  I  have  only  £2  IQS.  left." 

"My  wife  takes  in  a  few  boarders ;  just  makes  enough  to 
keep  us  going." 

"I  live  with  my  daughter.  I  took  in  £4  last  year  for 
sewing." 


HE  WILL  NOT  DO  IT  AGAIN  355 

The  only  property  most  of  them  had  was  their  character. 
This,  if  vouched  for  by  some  responsible  citizen,  earned 
them  an  income  from  the  state  when  all  other  sources  of 
income  had  failed. 

"Where  is  your  savings-bank  book?"  the  judge  asked. 
The  old  man  did  not  have  it. 

"You  ought  to  have  brought  it  in,"  said  the  judge,  "and 
also  your  income  tax  return." 

Applicants  for  pensions  with  post-office  savings-bank 
books,  income  tax  returns,  mortgages  to  pay,  and  insurance 
policies  are  certainly  a  novelty.  This  case  was  postponed, 
as  the  judge  said,  "for  search  as  to  the  value  of  your  prop- 
erty, and  for  an  investigation  of  your  savings-bank  book." 

An  applicant  who  had  £100  ($500)  in  the  savings  bank 
still  got  a  pension.  If  the  amount  had  been  only  £50  he 
would  have  been  entitled  to  the  full  pension  of  £18,  for  up 
to  £50  of  clear  property  or  £34  a  year  of  income  no  deduc- 
tion is  made.  As  in  this  case  there  was  an  excess  of  £50 
over  the  £50  allowed,  and  this  £50  contains  three  complete 
sums  of  £15,  there  was  a  deduction  of  £3.  This  left  him 
£15  of  pension,  which  he  was  duly  allowed. 

"You  are  not  entitled  to  a  pension,"  the  judge  said  to 
one  applicant.  "Your  income  last  year  was  over  one  pound 
a  week." 

"Thank  you,  sir,"  the  man  said  as  he  stepped  down.  "It 
shall  not  happen  again." 

That  they  had  relatives  able  to  support  them  did  not  debar 
persons  otherwise  qualified  from  the  receipt  of  the  pension. 
That  people  attempt  to  take  advantage  of  the  law  to  relieve 
themselves  of  the  burden  of  supporting  indigent  relatives  is 
certainly  true,  but  the  courts  can  and  do  compel  them  to 
continue  to  contribute  even  after  the  pension  has  been 
granted.  In  one  such  case  the  magistrate  said : 

"If  your  sons  think  they  are  going  to  get  out  of  support- 


356    PENSIONS  FOR  VETERANS  OF  WORK 

ing  yon  because  you  have  an  old-age  pension  they  will  find 
themselves  in  the  wrong  box.  They  have  yet  to  reckon 
with  me." 

Where  five  sons  had  been  voluntarily  contributing  eight 
shillings  and  sixpence  a  week  for  the  support  of  their  fa- 
ther, the  court  ordered  them  to  continue  to  pay  him  one 
shilling  a  week  each,  so  that  his  income  would  be  twelve 
shillings  a  week,  including  his  pension  of  seven  shillings. 

A  woman  who  had  received  a  pension  of  seven  shillings 
a  week  continued,  by  order  of  the  magistrate,  to  receive 
sixpence  a  week  from  each  of  her  two  sons. 

A  husband  and  wife  appeared  who  had  charge  of  a  school- 
house,  he  as  janitor  and  she  as  charwoman.  They  were 
helped  by  their  children.  Sometimes  it  took  four  of  the 
family  to  do  the  work.  The  father  made  £13  a  year.  His 
wife  earned  £10.  As  the  income  of  neither  of  them  was 
£34  a  year  each  received  the  full  pension  of  £18,  the  wife 
getting  the  same  as  her  husband. 

No  pensions  were  given  to  married  women  until  they 
produced  proof  of  the  amount  of  their  husband's  income, 
if  any.  If  this  was  greater  than  £104  ($520)  neither  would 
get  the  pension.  If  it  was  less  than  that  each  would  be 
entitled  to  a  pension  with  the  deduction  already  explained. 

In  Christchurch  I  saw  the  case  of  a  woman  whose  hus- 
band was  earning  £78  ($390)  a  year.  By  the  law,  in  con- 
sidering an  application  for  pension  for  a  wife  the  income  of 
a  husband  is  halved  between  himself  and  his  wife.  The 
income  of  each  of  this  couple  was  therefore  considered,  for 
the  purposes  of  the  act,  £39  a  year.  They  therefore  were 
both  entitled  to  a  pension  of  £13  a  year,  making  their  total 
income,  private  and  public,  £52  a  year  each,  or  £104  for 
the  two. 

"A  nice  little  income,  truly,"  said  the  judge. 

The  man  who  admitted  that  he  had  drawn  all  but  £50 


MAORIS   TOO   RICH   FOR   PENSIONS      357 

of  his  money  out  of  the  savings  bank  and  given  it  away, 
"as  he  thought  that  he  had  too  much  money,"  was  rejected 
on  the  ground  that  he  had  deprived  himself  of  property  in 
order  to  qualify. 

One  of  the  newspaper  humourists  of  New  Zealand  ex- 
plained the  omission  of  a  contemporary  to  publish  the  names 
of  old-age  pensioners  in  his  district,  as  is  done  usually  by 
all  the  newspapers,  on  the  ground  that  the  editor  was  prob- 
ably a  pensioner  himself. 

Maoris  are  eligible  for  pensions,  as  they  are  both  tax- 
payers and  voters.  The  number  of  Maoris  receiving  pen- 
sions is  one  in  forty;  of  the  whites,  one  in  seventy.  The 
Maoris  are  getting  proportionately  much  the  largest  share 
of  the  pensions,  and  there  is  to  be  an  investigation.  Asiatics 
are  outside  the  law.  The  Australasian  has  no  "open  door" 
for  the  Chinese. 

The  oldest  applicant  for  old-age  pensions  in  Wanganui 
was  a  native  woman  named  Katarina  Tiratapu,  who  alleges 
she  was  born  one  hundred  years  ago — in  1799.  Four 
Maoris  applied  to  the  court  at  Kaiapoi.  Two  of  them  could 
not  tell  how  old  they  were,  but  they  had  been  at  Kaiapoi 
before  the  great  tribal  war  of  1827 — seventy-two  years  be- 
fore. The  Maoris  are  large  landowners,  and  when  these 
began  to  make  a  statement  of  their  acres  they  at  once  dis- 
closed themselves  to  be  too  rich  to  be  made  pensioners. 

At  another  hearing  there  was  an  old  Maori  veteran  who 
was  a  strong  disciple  of  Te  Whiti,  an  adverse  claimant  as 
to  large  tracts  of  land  now  held  by  the  whites.  This  dis- 
ciple of  Te  Whiti  had,  not  long  before,  entered  upon  this 
land  and  ploughed  it  illegally  as  an  act  of  defiance.  This 
rebelliousness  did  not  seem  to  affect  his  chances,  for  his 
case  was  adjourned  only  for  further  inquiries  as  to  his 
means. 

This  policy  of  pensions  to  the  natives  is  of  course  severely 


358    PENSIONS  FOR  VETERANS  OF  WORK 

condemned  by  some.  It  is  pointed  out  that  thirty  shillings 
a  month  is  a  small  fortune  to  old  natives — a  great  deal 
more  in  proportion  to  them  than  to  the  Europeans.  It  is 
also  said  that  little  or  none  of  it  stays  with  the  recipient, 
as  the  younger  members  of  the  tribe  allow  the  old  natives 
only  the  prerogative  of  collecting  the  money. 

There  are  no  pension  lawyers  as  yet,  and  the  methods  of 
examination  adopted  by  the  judges  were  most  considerate. 
But  they  did  not  seem  careless.  At  Auckland,  for  instance, 
one  magistrate  threw  out  over  a  hundred  claims. 

The  judges  will  accept  no  testimony  as  to  character  from 
relatives,  "for/'  as  one  of  them  said  to  me,  "we  would 
then  have  the  whole  family  bolstering  each  other  up." 

Statements  are  made  by  the  opposition  press  of  New  Zea- 
land that  some  of  the  applicants  are  "well-trained  paupers 
and  hardened  loafers  presenting  carefully  prepared  evi- 
dence." Something  of  this  kind  no  doubt  there  may  be,  but 
the  best  opinion  I  could  get  was  that  the  percentage  of  fraud 
which  escaped  the  court  is  infmetisimal.  It  is  impossible 
to  see  the  old  people  in  court  and  in  the  post-offices  collect- 
ing their  monthly  payments,  and  doubt  that  they  are  bit- 
terly in  need  of  the  help  which  they  receive. 

In  going  from  Kurow  to  Mount  Cook  by  stage  we  passed 
some  little  "cob  huts" — made  of  mud  and  straw — squatting 
close  to  the  river.  "Some  of  our  old-age  pensioners  live 
there,"  the  driver  said.  "They  are  mostly  worn-out  miners, 
and  would  have  starved  but  for  that  pension.  They  live 
in  those  huts  on  the  public  reserves  along  the  river  bank, 
where  no  one  can  evict  them.  They  get  thirty  shillings  a 
month  and  have  no  rent  to  pay.  They  still  do  a  little  gold 
washing  and  can  keep  alive,  and  they  know  that  if  they  are 
ever  found  drunk  they  will  lose  their  pension." 

There  was  a  great  meeting  at  the  opera  house  in  Christ- 
church  during  my  visit  to  give  the  thanks  of  the  old-age 


PENSIONS    PROMOTE   THRIFT  359 

pensioners  of  Canterbury  to  the  Premier.  An  address  was 
presented  expressing  their  gratitude  and  trusting  that  he 
might  be  spared  to  enjoy  the  glory  of  a  ripe  old  age,  and 
to  reap  the  reward  of  witnessing  the  happy  effects  of  the 
measure  upon  the  aged  people  of  New  Zealand,  and  that 
New  Zealand  might  be  further  blessed  under  his  direction 
with  other  beneficial  social  reforms. 

In  his  reply  the  Premier  claimed  for  New  Zealand  recog- 
nition from  the  civilised  world  as  the  first  state  to  do  its 
duty  to  its  pioneer  settlers.  He  repeated  the  arguments 
which  he  had  given  to  me  in  conversation  that  the  old-age 
pensions  would  not  destroy,  but,  on  the  contrary,  would  pro- 
mote thrift. 

"There  is,"  he  said  to  me,  "now  something  for  the  aged 
worker  to  hope  for.  He  or  she  can  say,  'If  I  keep  on  till 
I  am  sixty-five  I  shall  have  an  old-age  pension.'  So  they 
struggle  along,  and  sobriety  and  virtue  are  encouraged. 
Under  our  previous  system  there  was  no  hope,  and  weak 
workingmen  or  workingwomen  took  to  drink,  theft  and 
vice.  The  others  worried  on,  but  in  despair,  with  no  en- 
ergy, breaking  down." 

To  the  same  effect  the  Honourable  William  Pember 
Reeves  has  said : 

"The  New  Zealand  pension  is  more  likely  to  induce  the 
poorest  to  lay  by  a  few  pounds  to  supplement  the  state's 
allowance  by,  say,  the  purchase  of  a  little  annuity,  or  con- 
tinue to  earn  some  small  wage  for  the  same  purpose,  than  it 
is  to  incite  them  to  waste  their  last  shilling  because,  for- 
sooth, when  they  come  to  sixty-five  they  are  to  be  recipients 
of  a  shilling  a  day." 

The  Premier  in  his  speech  argued  that  the  pension  was 
not  a  form  of  charitable  aid.  It  came  from  the  consoli- 
dated revenue,  to  which  every  pensioner  had  contributed 
for  twenty-five  years.  Like  education,  it  was  another  re- 


360    PENSIONS  FOR  VETERANS  OF  WORK 

turn  for  their  indirect  taxation.  He  pointed  out  that  judges 
and  other  civil  servants  of  the  state  received  pensions,  and 
urged  that  the  old  workingmen  and  workingwomen  should 
no  more  be  called  paupers  when  pensioned  than  the  super- 
annuated civil  servants.  But  the  Honourable  W.  H.  Mont- 
gomery, of  the  New  Zealand  Parliament,  one  of  the  sup- 
porters of  the  law,  calls  it  "a  glorified  system  of  charitable 
aid."  Still,  viewed  with  all  its  implications  and  conse- 
quences, the  old-age  pension  is  something  more  than  a  char- 
itable relief.  It  is  given  as  a  right.  It  is  a  step  toward  an 
equalisation  of  property.  It  does  not  require  that  its  re- 
cipients should  be  paupers.  It  will  inevitably  drive  the  pub- 
lic to  support  every  public  and  private  means  of  raising 
the  standard  of  life,  so  that  the  workingmen  shall  not  need 
pensions. 

The  latest  return  by  the  government  on  the  results  of  the 
old-age  pension  law  is  dated  June  19,  1899.  The  law  came 
into  force  November  i,  1898.  The  total  number  of  pen- 
sions granted  up  to  March  31,  1899,  was  7487,  represent- 
ing a  yearly  payment  of  £128,082  ($640,410).  The  aver- 
age pension  is  about  £17  2s.  ($85.50). 

A  later  memorandum,  furnished  me  by  the  courtesy  of 
Registrar  Mason  of  the  pension  office,  tabulates  the  results 
to  June  30  : 

"OLD-AGE  PENSIONS  ACT,   1898." 
Statement  of  claims  as  on  June  jo, 


Number  of  claims  established  ....................  95°5 

"       "       rejected  ......................  1028 

withdrawn  ....................  394 

"       "       awaiting  investigation  .......... 


12,566 


RESOURCES  WILL  ALSO  INCREASE  361 

Number  of  claims  established 95°5 

"  deaths 157 

"  cancellations 32  189 


"  pensions  in  force  as  on  June  30,  1899         9316 

At  the  average  of  £17  2s.  the  amount  payable  was,  June 
30,  1899,  at  the  rate  of  $796,518  a  year.  By  April,  1900, 
the  pensions  had  increased  to  $950,000  a  year. 

The  highest  amount  which  has  been  given  to  any  one  by 
Denmark  in  its  old-age  pensions  is  £16  16^.  a  year.  The 
Denmark  law  makes  no  such  statutory  limit  as  the  New 
Zealand  law  does.  It  stipulates  only  that  the  amount  of 
the  pension  shall  be  sufficient  to  support  the  pensioner  and 
his  family  and  enough  for  their  treatment  in  case  of  sick- 
ness. An  English  Parliamentary  document,  entitled  "Provi- 
sion for  Old  Age  by  Government  Action  in  Certain  European 
Countries,"  gives  the  returns  for  Denmark — the  only  other 
country  which  has  old-age  pensions — down  to  1896,  the 
latest  date  for  which  they  are  obtainable.  The  number  of 
persons  in  receipt  of  relief  has  increased  from  30,957  in 
1893  to  36,246  in  1896,  and  the  cost  of  the  relief  from 
£164,616  to  £216,317.  The  sum  expended  by  Denmark  on 
old-age  relief  has  exceeded  the  total  of  the  appropriations, 
but  the  excess  was  met  out  of  the  general  fund. 

The  calculations  of  the  New  Zealand  government  were 
that  the  first  year's  disbursements  would  amount  to  £90,000, 
or  $450,000.  The  number  of  pensioners  is  certain  to  in- 
crease and  the  disbursements  to  grow  larger,  but  Mr.  Sed- 
don  looks  forward  to  this,  as  he  told  me,  without  appre- 
hension. 

"If,"  he  said,  "old-age  pensions  increase,  so  will  the 
wealth  and  resources  of  the  country,  and  the  burden  will 
be  no  greater  in  proportion." 


362    PENSIONS  FOR  VETERANS  OF  WORK 

As  to  the  means  by  which  the  funds  will  be  provided  for 
the  growing  pension  list,  he  said,  "If  hereafter  the  burden 
exceeds  our  resources,  we  will  tax  land  and  income  more, 
and  I  have  already  so  intimated." 

Mr.  Seddon  asked  Parliament,  in  1899,  to  extend  the 
privileges  of  the  old-age  pension  law  to  foreigners  who, 
through  ignorance  or  misunderstanding,  have  omitted  to 
naturalise  themselves. 

He  also  promised  to  consider  the  demand  of  one  of  the 
women's  organisations  that  women  should  be  eligible  for 
old-age  pensions  five  years  earlier  than  men.  A  radical 
wit  insists  that  the  decreasing  birth  rate  of  New  Zealand 
suggests  that  the  country  needs  a  young-age  pension. 

The  New  Zealand  law  is  imitated  in  a  bill  which  was  in- 
troduced, late  in  1899,  into  the  Victorian  Parliament  by 
the  Premier,  Sir  George  Turner.  The  only  important  dif- 
ference between  the  proposed  law  of  Victoria  and  the  New 
Zealand  law  is  in  a  provision  that  pensions  shall  be  paid  to 
persons  before  they  have  reached  the  age  of  sixty-five  if 
they  have  been  rendered  infirm  by  unhealthy  occupations. 
The  New  Zealand  press  considers  this  a  distinct  advance 
upon  the  New  Zealand  system. 

The  old-age  pension  is  strong  with  all  classes  of  the  New 
Zealand  people,  Conservatives  as  well  as  the  others,  for  the 
pity  of  it;  it  is  strong  with  the  Liberals  for  the  democratic 
equalisation  of  property  in  it;  strong  with  the  poor  for  its 
freedom  from  the  taint  of  the  "dole." 

There  can  be  no  doubt  that  it  has  captured  the  heart  of 
New  Zealand.  It  is  the  most  popular  of  all  the  advanced 
legislation  of  the  last  ten  years.  Even  those  who  oppose 
"on  principle"  everything  done  by  "the  Seddon  administra- 
tion" had  words  of  praise  for  this.  It  appeals  to  a  tender- 
ness of  heart  which  is  a  characteristic  of  the  New  Zealand 
people.  One  sees  this  constantly  exhibited  in  their  treat- 


NO   MORE   AGED   TRAMPS  363 

ment  of  women,  children,  and  the  helpless.  Perhaps  this 
is  due  to  the  prosperity  of  the  country.  The  warm  sun- 
shine of  good  times  has  quickened  their  sensibilities.  It  is 
not  that  they  have  more  sensibility  than  others,  but  they 
can  better  give  it  play.  There  is  nowhere  a  kinder  people, 
kind  to  the  unfortunate  and  the  stranger ;  and  the  popularity 
of  this  helping  hand  to  the  forlorn  aged  is  a  part  of  this 
chivalry. 

The  Secretary  for  Labour,  in  his  annual  report  for  1899, 
comments  upon  the  absence  of  aged  tramps  looking  for 
work  as  one  of  the  specially  satisfactory  features  of  the 
year,  and  he  considers  this  undoubtedly  due  largely  to  the 
operation  of  the  old-age  pensions  act. 

All  the  world  is  talking  about  having  some  better  way 
of  taking  care  of  social  wreckage  than  the  poorhouse  and 
the  soup-kitchen.  The  key  to  the  action  of  New  Zealand 
is  the  same  here  as  in  so  many  of  her  novelties.  The  things 
others  only  talk  about  New  Zealand  does. 


CHAPTER  XV 

"A  SUBSTITUTE  FOR  A  FRENCH   REVOLUTION" 

THE  democratic  novelties  of  New  Zealand,  excepting  its 
government  railroads,  life  insurance  and  the  Public  Trustee, 
date  back  only  a  few  years,  and  are  the  fruits  of  the  elec- 
tion of  1890.  This  uprising  of  the  people  was  called  an 
election,  but  it  was  in  truth  a  revolution — just  such  a  revo- 
lution as  it  is  the  intent  of  democracy  an  election  shall  be 
when  revolution  is  needed. 

We  think  of  New  Zealand  as  a  new  country,  but  the  fact 
is  that  by  1890  New  Zealand  was  one  of  the  oldest  of  mod- 
ern societies  in  economic  iniquity  and  sin,  and  in  some 
things  the  oldest.  Though  the  youngest  of  nations,  it  had 
an  ancien  regime.  Instead  of  escaping  from  the  evils  of 
the  social  order  by  going  to  a  new  country,  the  Englishmen 
who  settled  New  Zealand  found  that  they  had  brought  all 
its  problems  with  them,  as  if  these  were  their  shadows,  as 
they  were.  These  evils  were  not  in  England  but  in  the  Eng- 
lish— in  themselves  as  citizens  of  the  world  of  wealth  in- 
stead of  commonwealth.  The  concentration  of  land,  capital 
and  other  machinery  by  the  few,  which  has  taken  half  a 
dozen  centuries  in  Europe,  where  the  "fittest"  had  to  begin 
with  the  help  only  of  water-wheels  and  spears,  and  has  re- 
quired a  hundred  years  in  the  United  States,  needed  only  a 
decade  or  two  under  the  southern  sun  of  New  Zealand, 
where  those  who  were  to  survive — "convey  the  wise  it  call" 
— had  in  hand  the  machinery  of  steam,  credit  and  politics — 

364 


NO   STANDING  ROOM  365 

railroads,  banks,  government  bonds,  joint-stock  companies 
and  representative  government  representing  the  represen- 
tatives. 

By  1890  a  situation  had  developed  in  the  New  Zealand 
paradise  which  was  intolerable,  to  those  at  least  who  had 
to  live  in  it — the  New  Zealand  people.  Its  evolution  in 
land  had  reached  an  extremer  point  than  it  has  found  either 
in  the  United  States  or  England,  or  even  Ireland.  The 
best  acres  were  in  the  hands  of  monopolists,  who  were  also 
absentees,  and  not  only  absentees  but  absentee  corporations. 

One  of  the  most  distinguished  citizens  of  Australasia,  a 
man  known  in  the  counsels  of  the  empire  as  well  as  in  the 
colonies,  said  to  me,  "The  land  and  other  legislation  of  New 
Zealand  and  the  other  colonies  is  due  to  the  extreme  be- 
haviour of  the  large  landowners  of  the  early  days.  They 
were  almost  all  men  who  began  without  land.  They  were 
'new  men,'  and  had  none  of  the  traditions  and  patriarchal 
and  baronial  pride  which  softens  ancestral  land-ownership 
in  the  old  countries.  To  these  men  land  was  simply  a 
means  of  making  money.  When  they  sheared  they  let  the 
shearers  sleep  in  the  open  and  fed  them  on  the  roughest 
and  coarsest  fare.  They  made  no  sort  of  concession  to  the 
people  in  any  direction.  Their  policy  was,  'Keep  off  my 
grass.' ' 

There  was  a  money  ring,  too,  manipulating  the  greatest 
necessity  of  modern  life  next  to  land  and  transporta- 
tion— credit.  Through  the  banks  it  took  toll  of  the  busi- 
ness men  and  of  industry  and  investment.  Through  the 
loan  agencies  and  mortgage  companies  it  kept  the  screw  of 
usury  twisting  the  necks  of  the  farmers,  small  tradesmen 
and  workingmen. 

This  land  monopoly  and  money  monopoly  to  defend 
and  aggrandise  themselves — monopoly  anywhere  must  be 
monopoly  everywhere — took  possession  of  the  greatest  mo- 


366     INSTEAD  OF  A  FRENCH  REVOLUTION 

nopoly  of  all — government.  It  was  a  government  of  squat- 
ters, by  squatters,  for  squatters.  "Squatter"  is  New  Zea- 
landese  for  land  monopolist.  "Land  spotters,  speculators 
and  grabbers  made  laws  to  suit  themselves,"  says  Min- 
ister McKenzie.  The  little  farmer,  forced  by  unjust  and 
deliberately  contrived  laws  to  pay  his  own  and  his  rich 
neighbour's  taxes,  had  to  sell  out  his  little  homestead  to  that 
neighbour  for  what  he  could  get.  The  workingman,  able 
to  get  neither  land  nor  work,  had  to  become  a  tramp.  The 
tradesman  had  to  follow  his  customers,  these  farmers  and 
workingmen.  The  blood  of  the  people  was  the  vintage  of 
the  rich.  There  was  a  "bitter  cry  of  outcast  New  Zealand." 
The  roads  were  marched  by  sturdy  men  crowding  in  from 
the  country  to  the  cities.  There  were  problems  of  strikes, 
unemployed  in  town  and  country,  overcrowding,  dear 
money,  idle  factories,  stagnant  markets,  and  unjust  taxation. 

Premier  Seddon  has  described  the  condition  to  which  the 
country  had  been  brought :  "We  had  soup-kitchens,  shelter- 
sheds,  empty  houses,  men  out  of  work,  women  and  children 
wanting  bread.  This  was  how  we  found  New  Zealand  in 
1890.  It  was  to  be  a  country  where  the  few  were  to  be 
wealthy  and  the  many  were  to  be  degraded  and  poverty- 
stricken." 

Another  distinguished  New  Zealander,  Mr.  W.  L.  Rees, 
the  biographer  of  Sir  George  Grey,  said  in  Parliament, 
"Unless  there  is  some  amelioration  of  the  terrible  suffering 
which  this  ceaseless  competition  is  inflicting  upon  the  com- 
munity we  are  on  the  brink  of  ruin  and  civil  war." 

In  a  country  where  everything  above  the  foundations  was 
still  to  be  built,  skilled  mechanics  could  get  no  work ;  where 
millions  of  acres  of  the  best  land  on  earth  lay  idle  year  after 
year,  farmers,  though  they  had  money,  could  get  no  land. 
There  was  the  incredible  spectacle  of  an  exodus  of  men 
and  women  with  wealth  and  youth  and  health  leaving  this 


A   REVIVAL  OF   RELIGION  367 

rich  and  virgin  country  to  find  in  other  lands  the  opportunity 
denied  them  there. 

That  the  turning  point  should  have  come  upon  the  defeat 
of  what  is  always  referred  to  in  Australasia  as  "the  great 
strike  of  1890"  was  certainly  not  to  have  been  expected  HI 
countries  so  little  industrial  as  Australia  and  New  Zealand 
were  then.  But  the  unexpected  is  to  be  expected,  even  in 
those  model  commonwealths.  Discontent  had  so  satu- 
rated the  people  that  it  needed  only  an  initiative,  and  the 
workingmen,  because  organised,  could  give  this  initiative 
most  easily.  This  strike  was  originally  an  affair  between 
the  steamship  companies  and  their  officers.  The  seamen 
magnanimously  went  in  to  help  out  the  officers,  and  with 
still  more  magnanimity  all  organised  labour  in  Australasia 
sympathetically  made  the  strike  universal.  The  classes  and 
masses  in  their  modern  representatives,  capital  and  labour, 
looked  civil  war  into  each  other's  faces.  The  strike  ended 
in  the  complete  triumph  of  the  capitalists,  because  the  most 
united,  the  best  organised,  and  with  the  clearest  conception 
of  just  how  much  the  crisis  meant. 

All  through  Australasia  this  defeat  of  labour  stirred  the 
popular  feeling,  in  an  unaccountable  way,  to  the  depths.  As 
often  seen  in  history  after  great  calamities,  like  panic,  fam- 
ine, or  conquest,  a  religious  revival  followed  this  catas- 
trophe, especially  in  New  Zealand,  but  it  took  the  form  of  a 
revival  of  that  kind  of  religion  we  call  democracy.  A  tidal 
wave  of  political  reformation  rolled  over  New  Zealand  and 
Australia.  In  New  Zealand  it  swept  the  Conservative  party 
from  power,  never  to  return,  and  inaugurated  the  changes  in 
the  social  economy  of  the  country  which  it  has  been  the 
province  of  this  book  to  chronicle. 

The  issue  has  proved  it  to  be  a  revolution,  but  it  was  not 
a  French  revolution.  It  was,  one  of  its  leaders  said,  "a 
substitute  for  a  French  revolution."  But  it  was  a  revo- 


368  INSTEAD  OF  A  FRENCH  REVOLUTION 

lution.  It  was  not  merely  a  change  in  parties;  it  was  a 
change  in  principles  and  institutions  that  amounted  to  noth- 
ing less  than  a  social  right-about-face.  It  was  a  New  Zea- 
land revolution,  one  which  without  destruction  passed  at 
once  to  the  tasks  of  construction. 

Merely  as  an  exhibition  of  a  nation's  intellectual  force, 
a  manifestation  of  social  energy  and  a  display  of  the  wit 
of  the  common  people,  the  work  done  by  the  New  Zea- 
landers  in  the  ten  years  that  followed  the  overthrow  of  the 
old  regime  is  unique. 

The  intolerable  situation  of  the  New  Zealanders  was  much 
like  the  intolerable  situation  in  which  Europe  and  America 
find  themselves  to-day,  except  that  in  one  or  two  respects 
their  evolution,  as  in  land,  had  reached  an  impasse  more 
complete  than  ours.  They  were  not  "scientific"  students; 
they  were  not  "reformers" ;  they  were  not  Utopians,  not 
Altrurians — only  citizens  of  that  sober-coloured  continent 
we  might  call  "Actualia."  They  were  hard-working  men 
and  women,  without  leisure  or  a  leisure  class.  They  were 
not  able,  like  the  Greeks,  to  spend  their  days  in  the  market- 
place talking  politics  while  slaves  worked  the  farms  and  the 
mines.  They  were  uninspired  men,  with  no  traditions  and 
no  theories.  They  knew  nothing  about  revolution,  and  had 
never  had  to  fight  for  their  liberty.  They  had  to  make  their 
own  living.  Their  country,  in  comparison  with  others, 
was  a  toy  country,  a  bijou  democracy.  I  have  sometimes 
thought  in  New  Zealand  that  the  consciousness  that  their 
theatre  wras  so  small  stirs  these  fellow  Anglo-Saxons  of 
ours  to  play  the  largest  possible  parts.  Athens  and  Jeru- 
salem were  not  big  places.  The  New  Zealanders  had  no 
philosophy  of  society,  and  only  a  resolve  to  have  the  fruits 
of  their  own  labours  and  of  their  own  government.  They 
had  the  help  of  no  eminent  statesmen,  at  least  not  of  any 
eminent  before  they  made  their  record  here. 


THE  ONLY   COMMON   PEOPLE  369 

They  were  just  "the  common  people."  But  they  were 
truly  the  common  people  in  a  sense  in  which  it  has  not  ex- 
isted since  early  New  England  and  which  in  Anglo-Saxon- 
dom  exists  now  nowhere  except  in  New  Zealand — the  only 
country  wholly  English  in  which  practically  every  settler  can 
read  and  vote  and  where  the  separation  of  classes  has  not 
made  common  action  for  the  common  good  impossible. 

This  common  people  were  stung  to  action  by  their  shelter- 
sheds,  soup-kitchens,  relief  works,  bankrupt  traders,  tramp 
workingmen,  evicted  settlers  and  the  exodus.  They  set  to 
work  to  save  themselves  from  this  old-world  civilisation. 
In  ten  years  they  have  produced  a  budget  of  reforms,  cor- 
rective and  constructive,  and  of  political  novelties  which 
will  bear  comparison  with  the  work  of  any  other  revolution, 
political  or  violent,  of  modern  times. 

We  are  exhorted  to  take  "one  step  at  a  time,"  and  are 
assured  that  this  is  the  evolutionary  method.  This  theory 
does  not  fit  the  New  Zealand  evolution,  as  will  be  seen  if 
we  focus  in  a  condensed  statement  a  catalogue  of  its  almost 
simultaneous  reforms. 

The  creative  activity  of  this  democracy — antipodean  in 
more  than  one  sense  to  that  of  older  peoples — entered  nearly 
every  province  in  the  field  of  modern  industrial  statesman- 
ship— land,  labour  and  capital,  finance,  transportation,  popu- 
lation, poverty  and  wealth,  domestic  and  international  com- 
petition, and  the  like.  It  dealt  with  the  tramp,  strikes, 
lock-outs,  slums,  monopolies,  sweating,  panics,  foreclosures, 
tax  sales,  speculation,  usury,  evictions,  rack-renting,  disfran- 
chisement.  millionairism  and  pauperism.  It  went  beyond 
remedies  for  what  was  wrong,  and  invented  a  new  alli- 
ance between  the  state  and  the  producers,  to  unite  the  re- 
sources of  the  whole  people  with  those  of  the  individual  in 
a  partnership  of  industry  both  at  home  and  in  the  foreign 
market. 


370  INSTEAD  OF  A  FRENCH  REVOLUTION 

Here  is  the  record  of  ten  years: 

The  policy  of  taxation  is  reversed.  The  general  property 
tax  on  improvements,  enterprise  and  poverty  is  abolished, 
and  the  taxation  for  national  purposes  of  land  and  incomes 
introduced.  Taxation  is  taken  off  from  capital  that  is  work- 
ing and  put  on  capital  that  is  idle.  The  small  man,  because 
small,  is  exempted,  and  the  rich  man,  because  rich,  is  made 
to  pay  more,  progressively,  the  more  land  and  income  he  has. 
The  burden  of  the  old  property  tax  forced  the  poor  men  who 
worked  their  places  to  sell  out  to  the  rich  neighbour,  who 
escaped  taxation  and  grew  rich  by  making  no  improvements. 
The  new  tax  is  planned  especially  to  make  the  rich  land- 
owner sell  to  his  small  neighbours  or  to  the  government, 
which  will  subdivide  and  sell  to  them  itself.  The  old  taxes 
built  up  monopolies;  the  new  taxes  "burst  them  lip."  To 
check  speculation,  to  equalise  poverty  and  wealth,  to  pre- 
vent great  estates — these  are  some  of  its  avowed  objects. 
"No  man  now  dreams,"  an  eminent  New  Zealander  said, 
"of  attempting  to  found  a  great  landed  estate  in  New  Zea- 
land." 

The  people,  by  the  use  of  their  powers  as  citizens,  get  land 
for  themselves  through  the  state  by  taking  it  back  from  the 
men  to  whom  they  have  previously  sold  it,  and  who  have 
added  field  after  field  into  great  monopolies.  The  people 
resume  these  lands  by  taxation,  by  purchase,  if  the  owners 
are  willing  to  sell,  and  by  force  of  law  if  they  will  not  sell. 
They  divide  the  lands  thus  recovered  into  gardens,  farms 
and  homesteads  for  the  landless.  But  to  break  the  vicious 
circle  by  which  private  property  in  land  leads  to  speculation, 
rack-rents,  foreclosure,  depopulation  and  monopoly  the  rev- 
olution institutes  a  new  system  of  land  tenure.  It  estab- 
lishes the  lease  in  perpetuity  by  the  state  with  limitations 
of  area,  cultivation  and  transfer.  It  inaugurates  a  policy 
which  is  meant,  ultimately,  to  make  the  state  in  New  Zea- 


REFORM  BEGINS  AT   HOME  371 

land  the  owner  of  all  the  soil  of  New  Zealand  and  the  peo- 
ple all  tenants  of  the  one  landlord  who  will  never  speculate, 
nor  confiscate  nor  rack-rent,  and  whose  monopoly  is  their 
monopoly. 

In  their  public  works  policy  the  people  establish  them- 
selves as  their  own  contractors.  The  democracy  begins 
the  reform  of  -the  sweating  system  where  all  reform 
should  begin,  at  home,  by  abolishing  it  in  its  own  work, 
doing  away  with  the  contractor  and  the  contract  system, 
with  all  its  evils  of  subletting  and  of  sweating  the  work- 
men and  the  work.  It  enters  upon  the  practice  of  direct 
construction  by  the  state  of  its  own  public  works  and  direct 
employment,  without  middlemen,  of  its  own  labour.  The 
men  hired  by  the  new  regime  to  build  railroads,  bridges, 
public  buildings,  make  roads,  etc.,  are  taken  by  preference 
from  those  citizens  who  need  work.  In  giving  them  work 
the  new  regime  also  gives  them  farms  and  homes  from  the 
public  lands  near  by  or  from  the  private  estates  which  it  buys 
and  cuts  up  for  that  purpose.  The  workingmen  themselves 
are  made  their  own  contractors  and  taught,  even  the  tramp 
and  the  casual,  to  work  together  co-operatively.  The  state 
as  an  employer  sees  and  saves  for  the  community  the  eco- 
nomic value  of  the  labour  of  the  old  and  incompetent,  the 
unskilled  and  the  tramp,  which  the  private  employer  lets  go 
to  waste. 

By  compulsory  arbitration  the  public  gets  for  the  gui- 
dance of  public  opinion  all  the  facts  as  to  disputes  between 
labour  and  capital,  puts  an  end  to  strikes  and  lock-outs, 
clears  its  markets  and  its  civilisation  of  the  scandals  and 
losses  of  street  fights  between  the  buyers  and  sellers  of  la- 
bour, and  enables  both  sides  to  make  contracts  without  strike 
clauses  for  years  ahead.  It  transfers  the  private  wars  of 
economic  enemies  to  a  court  room,  as  society  had  previously 
taken  the  private  wars  of  the  barons  from  the  field  into  the 


372  INSTEAD  OF  A  FRENCH  REVOLUTION 

court  room.  By  abolishing  the  contractor  it  abolishes  the 
sweating  system  in  public  works,  and  it  banishes  the  sweater 
in  private  industry  by  compulsory  arbitration,  with  its  power 
to  fix  minimum  and  maximum  wages  and  all  conditions  of 
labour,  by  forbidding  the  employment  of  boys  and  girls 
without  pay,  by  the  enactment  of  an  advanced  and  minute 
code  of  factory  laws,  by  regulating  the  hours  of  women  and 
children  and  so  of  men.  It  establishes  a  compulsory  half- 
holiday  by  law  for  factories  and  shops.  It  forbids  the  em- 
ployment of  uneducated  and  physically  defective  children 
and  of  all  half-timers.  For  the  unemployed  the  nation 
makes  itself  a  labour  bureau.  It  brings  them  and  the  em- 
ployers together.  It  reorganises  its  public  works  and  land 
system  so  as  to  give  land  to  the  landless  and  work  to  the 
workless.  The  fraud  of  compulsory  insurance  of  working- 
men  by  their  employer  is  stopped,  and  the  state  itself  in- 
sures the  working  people  against  accident.  For  those  for 
whom  no  private  employment  is  to  be  had  the  state  provides 
a  "state  farm" — a  shelter,  a  waiting-room  and  a  school  of 
work  and  co-operation.  It  carries  idle  men  and  their  fami- 
lies to  idle  land  and  organises  them  in  groups  of  co-operative 
workers,  giving  them  shelter  and  providing  them  with  every 
necessary  tool.  For  the  extirpation  of  the  slums — products 
of  speculation  in  land  and  of  sweating  of  labour — there  are 
the  land  laws  and  tax  laws  to  stop  speculation  and  the  labour 
laws  to  stop  sweating,  and,  besides,  the  people  have  empow- 
ered themselves  to  take  land  from  private  owners  within  or 
without  city  limits  for  suburban  homes  for  themselves  by 
friendly  purchase  or  by  condemnation.  Instead  of  paying 
heavy  profits  to  middlemen  the  people  can  divide  the  lands 
among  themselves  at  cost,  as  they  have  done  with  the  "re- 
sumed" farms. 

The  management  of  the  railroads  is  changed  from  boards 
of  commissioners,  independent  of  the  people,  to  a  Minister 


Tin  for  Houses  on  the  Road  to  Independence. 


(Page  211.) 


Land  for  the  Landless,  Work  for  the  Workless. 


(Page  372.) 


THE  POLICY  OF  MOST  ASSISTANCE     373 

and  Parliament  dependent  upon  the  people  and  responsive 
to  public  needs  and  public  opinion.  The  railroad  policy  is 
changed  from  the  use  of  the  highways  as  money-makers 
for  the  treasury,  relieving  the  general  taxpayer  at  the  ex- 
pense of  the  producer,  to  their  use  as  public  utilities  sup- 
plying that  necessity  of  life — transportation — at  cost.  The 
new  policy  is  to  lower  rates,  never  to  raise  them,  and 
to  keep  lowering  them  as  profits  increase.  New  lines  are 
built  for  the  people,  not  for  the  great  landowners.  The 
methods  of  construction  are  changed  from  private  contract 
to  co-operative  work,  largely  by  groups  of  unemployed,  with 
special  reference  to  the  settlement  of  them  and  other  landless 
people  on  the  land. 

The  state  takes  over  the  management  of  the  principal 
bank  of  the  colony.  It  assumes  the  role  of  chief  purveyor 
of  credits  to  the  commercial  and  financial  interests,  and  so 
doing  saves  New  Zealand  from  the  panic  of  1893. 

The  revolution  of  1890  does  more  than  follow  the  line  of 
least  resistance — it  adopts  the  policy  of  most  assistance. 
The  commonwealth  makes  itself  the  partner  of  the  industry 
of  the  people.  The  nation's  railroads  are  used  to  redistrib- 
ute unemployed  labour,  to  rebuild  industry  shattered  by 
calamity,  to  stimulate  production  by  special  rates  to  and 
from  farms  and  factories,  to  give  health  and  education  to  the 
school  and  factory  population  and  the  people  generally  by 
cheap  excursions.  To  pay  for  the  lands  taken  back  from  the 
private  owners,  the  people  get  cheap  money  on  government 
bonds  in  London,  and  to  equalise  themselves  with  competi- 
tors nearer  the  world's  markets  and  to  emancipate  them- 
selves from  the  usurer,  the  producers  of  New  Zealand 
give  themselves  cheap  money  through  the  Advances  to  Set- 
tlers Act.  Money  is  borrowed  in  London  at  Treasury 
rates,  to  be  loaned  to  the  individual  in  New  Zealand  at  cost, 
so  that  a  single  citizen  of  New  Zealand  gets  his  money 


in  London  at  the  same  rate  as  if  he  were  the  government — 
as  in  truth  he  is — plus  only  the  small  cost  of  the  operation. 
Instructors  are  sent  about  to  teach  the  people  co-operation 
in  work  and  in  industry,  like  dairying,  and  money  is  ad- 
vanced to  assist  in  the  erection  of  creameries.  Bonuses  are 
given  for  the  development  of  new  processes.  Patents  are 
bought  up,  to  be  opened  to  the  people  at  cost.  Millions  are 
spent  on  water-races  and  roads  to  foster  mining.  The  gov- 
ernment gives  free  cold  storage  at  the  seacoast  and  prepara- 
tion for  shipment  for  products  to  be  exported.  The  firm 
of  "Government  &  Co.,  Unlimited,"  is  established — a  part- 
nership of  the  people  as  a  state  with  the  people  as  individ- 
uals, in  agriculture,  gold  mining,  and  manufactures  for 
home  and  abroad. 

Women  are  enfranchised,  and  legislation  for  "one  man, 
one  vote,"  enfranchises  men,  too,  and  puts  an  end  to  the 
abuses  of  plural  voting  in  Parliamentary  and  municipal  elec- 
tions. On  election  day  one  can  see  the  baby-carriage  stand- 
ing in  front  of  the  polls  while  the  father  and  mother  go  in 
and  vote — against  each  other  if  they  choose. 

Last  of  all,  pensions  are  given  to  the  aged  poor. 

And  this  Fraternalism  pays.  In  reducing  railroad  rates 
to  the  people  as  profits  increase  the  government  increases 
its  profits  faster  than  it  reduces  rates.  The  country  is  pros- 
perous in  every  department — revenue,  manufactures,  com- 
merce, agriculture.  The  democracy  is  a  good  business  man. 
The  state  proves  itself  a  successful  money-lender  and  land- 
lord. It  makes  a  profit  and  can  lower  its  rents  and  rates  of 
interest,  and,  unlike  the  private  capitalist,  does  so. 

Perhaps  this  is  "socialism."  Whatever  we  call  it,  it  is  a 
fact  and  a  success.  With  the  help  of  policemen  and  polite 
society  we  are  keeping  socialism  out  of  our  streets  and  par- 
lours, but  we  do  not  seem  to  be  able  to  keep  it  out  of  our 
governments. 


THE  NEXT  STEPS  375 

This  middle  class  development  of  New  Zealand  does  not 
take  the  form  of  the  state  socialism  which  demands  "the 
ownership  and  operation  of  all  the  means  of  production, 
distribution  and  exchange."  Rather  we  see  the  state  giving 
its  principal  efforts  to  the  stimulation,  as  a  silent  partner, 
wise  counsellor  and  democratic  co-operator,  of  the  enter- 
prise and  industry  of  the  individual.  While  theorists  invite 
the  world  to  choose  between  the  catastrophes  of  state  social- 
ism and  trust  socialism,  New  Zealand  finds  a  way  out  be- 
tween these  extremes. 

It  was  "one  step,"  but  that  step  was  nothing  less  than  a 
complete  reversal  of  policy. 

Has  New  Zealand  shot  its  last  bolt  ?  Is  its  armory  empty 
and  its  energy  spent?  No,  if  we  can  trust  the  recent  com- 
plete victory  of  the  progressive  party  in  the  election  of  1899, 
the  temper  of  the  people  as  shown  in  conversation  and  the 
outspoken  utterances  of  their  statesmen.  Here  are  some 
of  the  definite  measures  which  have  been  publicly  favoured 
by  leaders  now  active  in  New  Zealand  affairs: 

State  fire  insurance. 

Further  democratisation  of  transportation  by  the  zone 
system  of  rates. 

Nationalisation  of  the  steamship  lines. 

Nationalisation  of  the  coal  mines. 

Complete  nationalisation  of  the  land. 

Assumption  by  the  government  of  the  business  of  mining 
and  selling  coal. 

Increase  of  the  land  and  income  taxes  for  the  further 
equalisation  of  rich  and  poor. 

Removal  of  tariff  taxation  on  the  necessaries  of  life. 

Establishment  of  government  offices  where  "cheap  law" 
can  be  served  out  to  the  people. 

Regulation  of  rents  for  the  protection  of  tenants  from 
political  pressure  by  landlords. 


376  INSTEAD  OF  A  FRENCH  REVOLUTION 

Extension  of  the  purchase  and  subdivision  of  the  large 
estates  so  that  all  the  people  may  have  land. 

State  banking  to  give  the  people  the  ownership  and  ad- 
ministration of  the  machinery  of  commercial  and  financial 
credit,  doing  for  the  business  class  what  the  state  with  its 
advances  to  settlers  does  for  the  farmers,  tradesmen  and 
workingmen. 

The  nationalisation  of  the  news  service. 

The  New  Zealand  idea  is  the  opposite  of  that  of  some 
theoretical  creators  of  society,  that  the  rich  are  to  become 
richer  and  the  poor  poorer,  until  the  whole  population  has 
been  sifted  into  brutes  of  money  and  brutes  of  misery,  who 
will  then  fight  out  the  social  question  to  the  death.  New 
Zealand  leads  in  the  actual  movement  now  going  on  in  the 
other  direction — the  aggrandisement  of  the  middle  class. 
The  middle  class  is  not  to  be  exterminated,  but  is  to  absorb 
all  the  other  classes.  The  world-wide  abolition  of  slavery, 
the  gradual  disappearance  of  absolute  political  power,  the 
displacement  of  the  individual  captains  of  industry  by  cor- 
porations with  multitudes  of  stockholders,  are  all  illustra- 
tions of  this  tendency.  The  key  to  all  the  legislative  and 
social  institutions  of  New  Zealand  is  in  this  conscious  and 
unconscious  middle  class  absorption  of  the  extremes.  The 
New  Zealander  wants  no  Armageddon  of  plutocrats  and 
paupers. 

One  hears  little  sectarian  socialism  talked,  but  is  every- 
where made  aware  that  the  people  of  all  parties  are  moving 
steadily  toward  this  fixed  purpose :  they  mean  to  mould  their 
institutions  of  taxation,  land  tenure,  public  ownership,  etc., 
so  that  there  shall  never  develop  among  them  those  "social 
pests,"  the  millionaire  and  the  pauper. 

The  New  Zealand  policy  is  a  deliberate  exploitation  of 
both  capitalists  and  proletariat  by  the  middle  class  which 
means  to  be  itself  "the  fittest  that  survives."  The  capitalists 


TO  BECOME  FREE,  REMAIN  FREE       377 

are  taxed  progressively,  and  the  proletarian  is  given  land 
and  labour  that  he  may  also  become  a  capitalist  to  be  taxed. 

There  is  nothing  really  new  or  sensational  about  the  New 
Zealand  democracy.  Its  political  novelties  prove  upon  in- 
spection not  to  be  novelties  at  all,  but  merely  like  most 
American  and  Australian  slang,  old  English  in  a  new  place. 
The  word  of  the  day  has  been  reform,  not  radicalism ;  resis- 
tance, not  reconstruction.  The  New  Zealanders  are  not  in 
any  sense  extraordinary.  There  is  only  one  remarkable 
thing  about  them,  and  that  is  an  accident.  They  are  the 
most  compact  and  homogenous,  the  most  equal  and  man- 
ageable democracy  in  the  world.  This  is  luck — not  inten- 
tion but  circumstance.  The  country  was  too  far  away  from 
Europe  and  from  the  thousand-year-old  stream  of  westward 
migration  to  become  New  Europe,  as  the  United  States  has 
done.  It  became  only  Newest  England — what  the  Puritans 
and  Pilgrims  planned;  the  kind  of  country  those  English- 
men, Washington,  Jefferson  and  Adams,  expected  would 
carry  on  their  constitution. 

"Let  us  pauperise  you  now  and  we  will  let  you  democra- 
tise us  by-and-by,"  the  monopolists  are  saying  to  the  people 
of  the  world.  To  become  reformers  we  are  all  to  become 
proletarians,  who  have  never  reformed  anybody,  not  even 
themselves.  Starving  men  may  fight  for  a  bone,  but  never 
for  liberty.  The  New  Zealanders  think  that  the  best  way 
to  become  free  is  to  remain  free. 

In  New  Zealand  the  best  stock  of  civilisation — ours — was 
isolated  by  destiny  for  the  culture  of  reform,  as  the  bacteri- 
ologist isolates  his  culture  of  germs.  New  Zealand  has  dis- 
covered the  anti-toxin  of  revolution,  the  cure  of  monopoly 
by  monopoly.  New  Zealand,  because  united,  was  able  to 
lead;  because  she  has  led,  others  can  follow. 

THE   END 


APPENDIX 

STATISTICS   OF   THE  TEN   YEARS 

IN  his  introduction  to  "A  Country  Without  Strikes"  the 
Honourable  William  Pember  Reeves,  ex-Minister  of  Labour 
of  New  Zealand,  and  author  of  its  Compulsory  Arbitration 
Law,  gave  some  statistics  to  show  that  the  industries  of  the 
country,  falsifying  predictions,  had  prospered  during  the 
operation  of  that  bold  experiment.  The  following  figures, 
taken  from  a  recent  compilation  of  the  Registrar-General 
of  New  Zealand,  present  the  details  of  progress  during  the 
decade  1890-1899,  when  the  land,  labour,  fiscal,  and  other 
reforms  described  in  this  volume  were  set  in  motion. 

The  population  of  the  colony  has  increased  from  626,658 
to  756,506,  exclusive  of  Maoris.  Deposits  in  banks  of  issue 
increased  17.97  Per  cent,  from  £12,368,610  to  £14,591,223, 
an  increase  of  £2,222,613;  deposits  in  Post-Office  Savings 
Banks  117.88  per  cent,  from  £2,441,876  to  £5,320,371,  an 
increase  of  £2,878,495  ;  unimproved  value  of  land,  11.79  Per 
cent.,  from  £75,497,379  to  £84,401,244,  an  increase  of 
£8,903,865 ;  valued  improvements  52.05  per  cent.,  from 
£36,640,335  to  £54,190,103,  an  increase  of  £17,549,768;  the 
private  wealth  52.05  per  cent,  from  £142,631,461  to  £217,- 
587,481,  an  increase  of  £74,956,020.  Occupied  holdings 
increased  from  38,178  to  62,485,  and  the  customs  from 
£1,541,395  to  £2,042,602.  There  was  an  increase  of  4,459»~ 
085  acres  in  the  area  of  cultivated  land,  exclusive  of  or- 
chards, gardens  and  plantations.  Sheep  increased  from 

379 


i6,ii6,ii3  to  19,348,506;  cattle,  513,831  to  1,210,439; 
horses,  211,040  to  260,931. 

Railways  increased  in  mileage  14.22  per  cent.,  and  in  gross 
receipts  44.77  per  cent.;  the  gold  output  was  doubled  from 
£733,438  in  1890  to  £1,513,180  in  1899.  In  percentage 
the  population  increased  by  20.72  per  cent,  in  the  ten  years; 
the  imports,  45.28;  the  exports,  25.15;  the  customs  revenue, 
32.48;  the  cultivated  land,  55.63;  sheep,  20.06;  cattle,  45.52; 
horses,  24.11;  telegraphs  mileage,  36.50;  and  messages,  in 
number,  76.92. 

The  figures  of  the  increase  of  the  public  debt,  and  its  pur- 
poses, have  been  given  on  page  338. 


INDEX 


INDEX 


Adelaide,  175 

Advances  to  Settlers,  82,  167,  299,  329, 
373 ;  for  creameries,  208,  374.  See 
also  Government  &  Co.,  Unlimited 

Arbitration,  see  Labour 

Area,  3 

Artisans  on  the  land,  161,  173 

Ballance,  John,  83,  102,  105,  in,  120, 
121,  130,  134, 150,  155,  173, 195,  196, 
204 

Bank  of  New  Zealand,  276  et  seq.,  373 

Best,  R.  W.,  167,  247,  269 

Bonuses,  310  et  seq.,  374 

Browning  quoted,  326 

Butler,  Minister,  324 

Cadman,  A.  J.,  62,  66,  69 
Canada,  State  aid  to  industry,  330 
Capitalists  forced   to   reduce   interest, 

307;  warned,  106 
Capital     and     legislation,     285 ;     no' 

warred  against,  137 
Cheap  money,  300  et  seq. 
Cheviot  estate,  157  et  seq. 
Chinese  manufacturers  in  Victoria,  239 
City  and  country,  244 
Civil  Service  Board,  New  South  Wales, 

44 

Coal  ring,  10,  104,  336 

Cockburn-John  A.,  323,  330 

Coghlan,  T.  A.,  44,  101 

Common  people,  369 

Competition,  international,  309;  by 
state,  52 

Compulsion,  253,  260 

Compulsory  arbitration,  18,258  et  seq., 
372;  holidays,  see  Labour;  pur- 
chase of  land,  127, 143,  144,  145,  172, 
174,  176,230,370,373,375 

Conciliation,  see  Labour 

Contractor,  abolition  of,  82,  103,  371 

Contracts  and  safety  of  the  people,  in 

Co-operation,  i,  87,  225,  227,  374;  in 
Canada,  331;  in  land  settlement,  83, 
1 78,  209 ;  in  New  Zealand,  332, 374 ; 


in  public  works,  83,  160,  209,  371 ; 

at  state  farm,  202 ;  for  unemployed, 

217,  220  et  seq. ;  in  Victoria,  321 
Co-operative  butty   gangs,   100;    coal 

mine,  87;    contracts,  82,   103,  371; 

criticisms,     101 ;      sugar     mills     of 

Queensland,  309  et  seq. 
Cowles,  James  L.,  79 
Credit  as  necessity  of  life,  287 

Dan  ton,  n,  326 
Davitt,  Michael,  220,  313 
Debts,  public,  4,  56,  150,  281,  338 
Democracy,  I,  4,  7,  59,  61,  85,  87,  141, 
164, 198,  212,  260,  276, 289,  297,  303, 
325,  364,  367,  369,  374,  377 
Denmark,  old  age  pensions,  339,  346 
Diaz,  85 

Education,  45,  212,  230,  246,  372;  and 
politics,  296 ;  technical  and  agricul- 
tural, 230 

Eight  hours'  movement,  233,  234 

Ell,  H.  G.,  123 

Exodus,  84,  108,  134,  366 

Factory  Acts,  see  Labour  Laws 
Families  of  workingmen  kept  together, 

200 

Farmers'  support  of  labour  policy,  242 
Fraud  prevented  by  arbitration,  267 

Germany,  pensions,  341 
George,  Henry,  120 
Gladstone,  W.  E.,  151 
Government  printing  office,  90 
Grace,  M.  S.,  292 
Grey,  Sir  George,  81,  121,  126,  129 

Hall- Jones,  Wm.,  102 
Horticultural  school,  320 
Human  nature,  331 


Immigration,  4,  13,  57,  67,  192,  377 
Improved  Farm  Settlements,  see  Land 


383 


384 


INDEX 


Insurance,  accident,  257, 372 ;  fire,  375 ; 

life,  12  et  seq.,  181 
International  arbitration,  275 
Interest  rates  reduced,  307 
Irrigation,  320 
Isolation,  3,  377 

Japanese  labour,  315 
Jennings,  W.  T.,  217 

Kea,6 

Kenney,  H.  Eyre,  346 

Kidd,  Benjamin,  314 

Kingston,  C.  C.,  86,  224,  307,  322,  327 

Labour,  accident  insurance,  257;  arbi- 
tration, South  Australia,  237,  264; 
bureaus,  197,  198,  200;  children, 
254;  Chinese  evasion  of  minimum 
wage  law,  in  Victoria,  239 ;  compul- 
sory arbitration,  18, 258  et  seq.,  372 ; 
compulsory  half-holiday,  246,  252, 
253,  254,  372 ;  conciliation,  261  et 
seq. ;  and  contract  system,  83  et 
seq. ;  see  also  contractor  and  co-op- 
erative contracts;  Department,  200, 
202,  246  et  seq.,  372;  domestic  ser- 
vice, 257 ;  employment  of  boys  and 
girls  without  payment,  prevention 
act  256,  372;  factory  inspection, 
255,  256;  hours,  47,  49,  233,  234, 
252,  254,  255,  372;  Japanese,  315; 
labour  law  penalties,  255  et  seq. ; 
labouring  men  in  Ministry,  196,  243; 
laws,  223  et  seq.,  372  ;  leaders'  evo- 
lution, 243  ;  Leongatha  state  farm, 
230;  mental,  251;  minimum  wage 
law  of  Victoria,  236 ;  minimum  wage 
in  New  Zealand,  256, 372 ;  mothers, 
254;  old  workmen,  89,  95,  203,  238, 
241,  248,  343,  371.  See  also  Old 
Age  Pensions  ;  organisations,  233 ; 
parties,  155, 233,  234,  242,  313;  pro- 
gram supported  by  farmers,  242; 
seats  for  shop-girls,  254 ;  shop  regu- 
lation, 254, 255  ;  state  farm  at  Levin, 
202,  372.  See  Trades-Unions; 
wages,  47,  89,  97.  See  Minimum 
Wage  Law ;  white  against  black, 
310  et  seq. ;  workman  denned,  175. 
See  Unemployed 

Land,  advances  for  improvements,  174 ; 
Ardgowan,  172;  artisans  as  settlers, 
161,  173;  auction,  141;  ballots,  139, 
141,  189;  Board,  182;  bonanza 
farming,  172;  Cheviot  estate,  157  et 
seq.,  complaints,  163,  180;  closer 


settlement,  82,  94,  157  et  seq.,  172, 
179;  closer  settlement  productive- 
ness, 166;  compulsory  purchase,  127, 
143, 144,  145.  172, 174,  176,  230,  370, 
373,375  ;  consolidation,  127, 152,154, 
162;  co-operative  villages,  178;  De- 
partment and  unemployed,  200  et 
seq.,  250;  distribution,  152;  dum- 
my ism,  128;  effect  of  land  tax,  170, 
171;  Elderslie  estate,  170;  exami- 
nations of  applicants,  182;  Fair 
Rent  bill,  179;  freehold,  135,  153, 
154,  156,  196,  370;  Gladstone,  W. 
E.,  151;  grant  to  railroads,  53,  54; 
gridironing,  127,  133;  homestead 
blocks  in  South  Australia,  1 75 ; 
homesteads  reserved,  146,  157,  181 ; 
Improved  Farm  Settlements,  99,  204 
et  seq. ;  irrigation,  320;  large  es- 
tates, 68,  107, 116, 122,  133, 156,  170, 
370,  376;  laws,  137  et  seq.;  lease- 
hold conditions,  184;  leasehold  in 
perpetuity,  139,  140,  142,  147,  153, 
167,  178,  370;  Maoris,  29,  178; 
married  men  favoured,  213 ;  Mc- 
Kenzie  on  new  Irish  land  policy, 
136;  Momona,  162;  monopoly,  4, 
104,  126,  132,  134,  136,  149,  365 ; 
mortgages,  133 ;  Murray  River  colo- 
nies, 221 ;  nationalisation,  154*  na- 
tive, 29;  New  South  Wales,  155; 
Oklahoma,  191 ;  owned  by  absentee 
corporations,  128,  365 ;  petitions  for 
land  resumption,  168;  prices,  164, 
177;  private  ownership,  155?  pur- 
chase, rule  of  compensation,  145  ; 
Queensland,  155  >  and  railways,  68; 
ranger,  185  ;  rents,  179 ;  rents,  regu- 
lation of,  375  ;  resumption,  127,  143, 
150,  155,156,  172,  174,  176,  180,230, 
370;  revaluation,  179;  Rolleston, 
Wm.,  154,  193;  scrutineer,  189; 
settlements  profitable,  180,219;  set- 
settlement  and  public  works,  83 ; 
settlement  and  railways,  67;  small 
ownership  and  large  ownership  com- 
pared, 166,  171,  172;  speculation, 
143,  148,  155,  156,  162,  370;  spot- 
ting, 127,  133;  suburban  homes,  1 74, 
372;  taxation,  104  et  seq. ;  tenantry 
133,  151,  154,  173;  values  increased 
by  state  aid  to  production  and  ex- 
port, 62,  329 ;  Victorian  Minister  of 
Lands  on  Cheviot,  167;  village  set- 
tlements, 92,  94,  170,  172,  173,  174, 
175,  178,  180,  193,  195,  196,  204; 
Waikakahi  estate,  180;  Whangamo- 


INDEX 


385 


mona,  208 ;  white  men  under  Maori 
landlords,  30;  women  as  settlers, 
185  ;  workmen's  settlements,  1 73, 1 74 

Langley,  Venerable  Archdeacon,  102 

Law  of  the  market,  304 

Lawyers,  government,  30;  in  Com- 
pulsory Arbitration  Court,  263 

Levin  state  farm,  201 

Life  insurance,  12  et  seq.,  181 

Makohine  viaduct,  82,  96 

Maoris,  I,  6,  9,  29,  56,  105,  178,  205 

Martin,  John  C.,  21 

March,  J.  E.,  198 

Massachusetts    Board   of   Arbitration, 

260 

McGregor,  Dr.  Duncan,  340 
McKenzie,  John,  129,   130,    132,    133, 

135,  136,  138,  139,  143,  144,  146, 147, 

148,  149,  150, 154,  155,  157,  158,  196, 

203,  206,  366 
McLachlan,  Minister,  334 
Melbourne  Trades  Hall,  233 
Mexico,  85 
Middle  class,  376 
Millionaires  not  wanted,  4,  376 
Mills,  James,  269 

Miners  subsidised,  310,  333,  334,  374 
Momona,  162 
Money  for  farmers,  299 ;  market  law, 

304;  ring,  299, 365 
Monopoly,  curse  of,  104.     See  Land. 

See  Rings. 
Montgomery,  W.  H.,  360 

Nationalisation,  banking,  376;  coal, 
337,375;  fire  insurance,  375 ;  land, 
154,  375 ;  lawyers,  375  ;  mines,  236 ; 
news,  375 ;  steamships,  50,  337,  375 

New  South  Wales,  Advances  to  Set- 
tlers, 299 ;  before  and  after  the  panic, 
297;  Board  for  Exports,  321 ;  butty 
gangs,  100;  Civil  Service  Board, 
44 ;  co-operative  colonies  for  unem- 
ployed, 226;  co-operative  villages, 
92;  eight  hours'  day  in  public 
works,  234;  government  does  not 
recognise  trades-unions,  236;  La- 
bour Party,  155,  234 ;  land,  155 ; 
miners  subsidised,  334 ;  panic  ot 
1893.  277;  railways,  32,  35,  37,  41, 
44.  48,  5°.  51.  53.  54.  58;  State  aid 
to  industry,  310  et  seq. :  sugar,  316; 
unemployed,  198,  199,  250 ;  Unem- 
ployed Advisory  Board,  102,  203,  228 
et  seq. ;  wells  for  farmers,  310 

New  York  and  panic  of  1837,  280 


Oamaru,  52 

Old  Age  Pensions,  2, 9, 112, 339  et  seq. 

Oliver,  Railroad  Commissioner,  36 

Paine,  Thomas,  346 

Panic  of  1893,  276  et  seq.,  373 

Parliamentary  government  and  possi- 
bilities, 295 

Pauperism  in  England,  108 

People,  14,  74,  326,  369,  374 

Plunkett,  Horace,  227 

Population,  3,  4,  10 

Postal  Savings  Bank,  55,  181 

Post  Office,  55,  299,  339 

Pott,  G.  W.,  316 

Printers'  farm,  218 

Progressive  Liberals,  122,  341 

Public  Trustee,  12  et  seq.,  181 

Public  Works,  67,  69  et  seq.,  82,  107, 
1 60,  200,  250,  292,  371 

Queensland,  aid  to  production  and  ex- 
port, 310  et  seq. ;  co-operative  sugar 
mills,  309  et  seq.;  land,  155;  rail- 
ways, 32,  36,  37,  41,  42,  48,  50,  51, 
53,  54,  58 ;  subsidies  to  miners,  334 

Railways,  31-81;  Appeal  Board,  45, 
46,  49;  appointments,  39,  42,  43; 
arbitration,  45,  47;  average  haul,  50, 
51;  breeding  animals,  33;  coal  rates, 
51;  Commissioner  system,  46,  47, 
70;  comparison  of  rates,  51;  con- 
struction, 69,  372 ;  Cowles,  James 
L.,  79;  criticisms,  63,  64;  deficit, 
49>  S°j  discrimination,  35,36;  earn- 
ings, 49,  50;  educational  qualifica- 
tion, 45 ;  employe's,  39,  42  et  seq. ; 
employes  and  politics,  38,  48;  ex- 
perts, 43;  favouritism,  35;  forfeit- 
ure. S3.  54;  f""'»  33:  genius,  43; 
holidays,  49;  hours  of  labour,  47, 
49;  Hungary,  77,  81;  land  grants, 
53.  54?  and  land  values  13,  68; 
libraries,  33 ;  lime,  33,  82  ;  manage- 
ment by  Minister,  71,  372,  373,  the 
Midland,  53;  new  lines,  39-41,  372; 
New  South  Wales,  32,  35-37,  41,  44. 
48,  51.  53.  54.  S8;  newspapers,  33 ; 
parcels,  33 ;  pensions,  49 ;  policy, 

31,  50,  56,  6l,  62,  67,  72,  373,  374; 
political  pressure,  38,  70;    power  of 
public  in  management,  60  et   seq., 
75;  private,  51,  53,  54;  promotion, 
43,44;  public  and  private  compared, 
51,54,56,  59,  66,  67;    Queensland, 

32,  36.  37.  4'.  48,  5«.  5'.  53.  54.  5* ; 


386 


INDEX 


rates,  32  et  seq.,  39,  51,  53,  61,  65, 
71 ;  rates,  gazetted,  42 ;  rates  high, 
51, 73 ;  rates  to  large  and  small  ship- 
pers, 35 ;  rates  never  raised,  66, 373 ; 
rates  reduced  for  farmers,  61, 62, 65 ; 
rebates,  35;  reduction  of  rates,  62, 
65;  Russia,  35,  77,  81;  and  school 
children,  31,  69,  373 ;  second  class 
accommodation,  64;  seeds,  34;  settle- 
ment, 67,  372 ;  South  Australia,  32, 
36,  39,  48,  50,  58;  "  starved-sheep 
rates,"  69;  stock,  33;  suburban 
trains,  33;  Sydney  tram-car  men, 
48, 49 ;  Tasmania,  50 ;  trades-unions, 
47,  48,  73 ;  and  unemployed,  67,  372, 
373 ;  vacancies,  43 ;  Vaile,  Samuel, 
72,  75  ;  vegetables,  33 ;  Victoria,  36, 
40,  43,  49,  50,  58,  72;  vote,  38,  48; 
wages,  47 ;  water  competition,  52  ; 
Wellington  and  Manawata,  51 ; 
Western  Australia,  50;  and  working 
people,  32,  33,  50, 69,  73,  373 ;  work- 
shops, 57,  58;  zone  system,  72,  et 

seq.,  375 

Rees,  W.  L.,  366 
Reeves,  Wm.   P.,  106,   107,  117,  126, 

136,  247,  259,  274,  359 
Religion  and  democracy,  367 
Rents,  regulation  of,  338 
Rings,  coal,  10,104,337;  government, 

366 ;  land,  104,  365 ;  meat-freezing, 

IO;  money,  104,  299, 365;  sheep,  10; 

shipping,  87,  104,  335  ;  timber,  10 
Rolleston,  Wm.,  154,  193,  204 
Russia,  railways,  35,  77,  81 

Salisbury,  Marquis  of,  254 

Savings  banks,  55 

Schools  and  government,  296,  297 

Seddon,  R.  J.,  31,  62,  68,  74,  80,  84.95, 
102,  105,  106,  112,  113,  124, 153, 155, 
173,  206,  254,  269,  273,  289,  308, 

336,  337.  338,  345.  359.  361,  366 

Seligman,  Professor,  1 14 

Settlements,  see  Land 

Shipping  ring,  87,  104,  335 

Shop  Acts,  see  Labour  Laws 

Skertchly,  Professor,  314 

Socialism,  375 ;  Australasian,  335 

South  Australia,  advances  to  settlers, 
299,329;  arbitration,  237,  264;  con- 
tracts for  steamship  freights,  328; 
co-operative  villages,  92 ;  homestead 
blocks,  175;  income  tax,  118;  land, 
155  ;  land  tax,  121 ;  produce  export 
depot,  310,322  et  seq. ;  railways,  32, 
36,  39,  48,  50/58;  state  bank,  294, 


300,  305 ;  telephones,  55, 56 ;  village 
settlements,  220,  226,  227 
Spahr,  Charles  B.,  172 
Speculation  in  land,  155,  156,  162,  370 
State,  Bank,  293  et  seq. ,  300 ;  as  banker, 
278  et  seq.,  376;  bull,  326;  coal 
dealer,  337;  clothing  factory,  101 ; 
as  competitor,  52>  in  co-operative 
sugar  mills,  309;  employer,  371; 
exporter,  309  et  seq. ;  farm,  201, 
372;  as  farmer,  159;  fire  insurance, 
375 ;  help,  I ;  hotelkeeper  and  guide, 
34;  as  insurer,  12,  181,257;  as  land- 
lord, 151,  154,  173,  374;  as  land- 
monopolist,  371 ;  lawyers,  30,  375 ; 
as  money  broker,  299,  374;  as  mo- 
nopolist,377;  news  distribution, 3 75; 
partner,  369,  375;  railways,  31-81; 
railway  workshops,  57,  58;  real  es- 
tate dealer,  141,  151;  savings  banks, 
55 ;  socialism,  375 ;  steamships,  50, 
327;  sugar  refiner,  316;  telegraphs, 
55 ;  telephones,  55 
"  Stone  wall,"  345 

Stout,  Sir  Robert,  127,  130,  145,  155 
Street  car  lines,  New  South  Wales,  48 
Strike  of  1890,  10,  46,  233,  259,  367 
Strikes  still  possible  under  compulsory 

arbitration,  271 
Suffrage,  340,  374 

Sugar  Mills,  New  South  Wales,  313; 
Queensland,  309  et  seq. 

Taverner,  Minister,  333 

Taxation,  absentees,  112,  117,  118; 
Cheviot  Estate,  115;  Cheviot  valua- 
tion, 158;  corporations,  112,  118; 
death  duties,  116;  Ell,  Henry 
George,  123;  Henry  George,  120; 
illustrative  figures,  115;  improve- 
ments exempt,  112,  114;  improve- 
ments taxed,  109;  income  tax,  105, 

112,  117,  118,  119;  land  and  income 
tax,  105,  in,  112, 118,  121,  158,  170, 
I7I>  37°.  375  5  land  tax  and  large  es- 
tates, 116,  119;    life  insurance  pre- 
miums exempt,  118;  mortgages,  112, 
1 13, 1 14,  1 16 ;  for  old  and  infirm  tax- 
payers, 113;    Pitt,  124;  progressive, 
105,  112,  116,  118,  181,  370;  prop- 
erty tax,  109,  370 ;  rating  of  unim- 
proved values,  120;  Seligman,  Prof., 
114;  single  tax,  120;  small  men,  112, 

113,  116,  118,  370;    South  Australia, 
121 ;     steamship     companies,    118; 
tariff,    122,   375;     valuations,    115; 
yield  of  absentee  tax,  117?   yield  of 


INDEX 


38; 


graduated  tax,  117;  yield  of  income 
tax,  119;  yield  of  land  tax,  117,  119 

Telegraphs,  55 

Telephones,  55 

Trades-Unions,  10,  47,  48,  73,  74,  87, 
233,  236,  264,  271 

Tregear,  E.,  197,  199,  247 

Trenwith,  W.  A.,  167 

Tropical  labour  problems,  314 

Trustee,  Public,  12  et  seq.,  181 

Trust  socialism,  375 

Tucker,  209 

Unemployed,  67,  69,  82,  92,  94,  102, 
160,  192,  197  et  seq.,  203, 228  et  seq., 
245.  366,  372,  373 

Union  Steamship  Co.,  46 

Vaile,  Samuel,  72,  75 

Victoria,  advances  to  settlers,  299 ;  aid 
to  export  and  production,  310;  be- 
fore and  after  the  panic  of  1893, 297 ; 
benefits  of  policy  of  bonuses,  322; 
Chinese  manufacturers,  239;  con- 


tracts for  steamship  freights,  317, 
333>  co-operative  contracts,  100; 
co-operative  education,  321;  horti- 
cultural school,  320;  irrigation,  320 ; 
labour  organisations,  233 ;  Leon- 
gatha  State  Farm,  230;  minimum 
wage  law,  236;  Minister  of  Lands 
on  Cheviot,  167;  Old- Age  Pension 
Bill,  362 ;  railways,  36, 37, 40, 43, 49, 
So,  58,  72;  sugar  mill,  316;  tele- 
phones, 55 

Village  settlements,  see  Land 
Vogel,  Sir  Julius,  13,  58,  67,  130,  192 

Wakefield,  Edward  Gibbon,  8 

Wallace,  Alfred  Russel,  1,314 

Ward,  J.  G.,  66,  342,  344,  347 

West  Australia,  50, 155,  329,  334 

Wheat  yield,  164,  181 

Wingless  birds,  7,  117 

Women,  185,  202,  238,  252,  254,  314; 

320,  340,  362,  374 
Workman  defined,  175 
Workingmen  and  Ministry,  196,  243 


J-5" 


THE  LIBRARY 
UNIVERSITY  OF  CALIFORNIA 

Santa  Barbara 


THIS  BOOK  IS  DUE  ON  THE  LAST  DATE 
STAMPED  BELOW. 


Series  9482 


IX  SOUTHERN  REGIONAL  UBRARY  FACILITY 


A     000  698  965     1 


